Third Point Reinsurance Ltd. (NYSE:TPRE) (the "Company") today announced that it has entered into a definitive agreement (the "Agreement") with the holders of Sirius International Insurance Group, Ltd.'s (NASDAQ:SG) ("Sirius") Series B Preference Shares (the "Series B Preference Shares"), pursuant to which such holders have agreed to remain investors in the Company (to be renamed SiriusPoint Ltd.) upon the closing of the proposed merger (the "Merger") contemplated by the Merger Agreement between the Company and Sirius.
Under the Agreement, the four institutional investors that hold Sirius's Series B Preference Shares, Bain Capital Special Situations Asia, L.P. ("Bain"), CCOF Master, L.P. ("Carlyle"), Centerbridge Credit Partners Master, LP and Centerbridge Special Credit Partners III, LP (collectively, "Centerbridge"), and GPC Partners Investments (Canis) LP ("Gallatin" and, together with Bain, Carlyle and Centerbridge, collectively, the "Cornerstone Investors") have agreed that upon the closing of the Merger, they will convert their existing Series B Preference Shares of Sirius into up to $260 million face value of newly-issued Series B Preference Shares of SiriusPoint (the "New Preference Shares"). The New Preference Shares will be perpetual in nature, carry an 8.00% annual cumulative cash dividend, and will be callable by SiriusPoint on each fifth anniversary of the closing of the Merger or upon certain other events. At the time of issuance upon the closing of the Merger, SiriusPoint will have the option to substitute up to $60 million in cash in lieu of an equal face amount of the New Preferred Stock (or pay in cash the agreed New Preference Shares face amount of $260 million in full).
In exchange for the New Preference Shares, the Cornerstone Investors have also agreed to toll certain potential claims they may have against Sirius from the date of the Agreement until the closing of the Merger or the earlier termination of the Agreement, and upon the closing of the Merger agree to release such potential claims.
Sid Sankaran, currently Chairman of the Company and slated to be Chief Executive Officer of SiriusPoint said: "Reaching an agreement with the Cornerstone Investors is an important milestone for SiriusPoint. This agreement provides us with certainty regarding our capital position going forward, resolves amicably a potential litigation, and constitutes an important endorsement of SiriusPoint by sophisticated investors. Having this impressive slate of investors in the combined company further reinforces our strong balance sheet as we support our clients and broker partners in the upcoming renewal season."