Fairfax Financial accepts $694.46 million of notes in tender offer

By Angela McDaniels

Tacoma, Wash., June 6 - Fairfax Financial Holdings Ltd. received tenders for $764,348,000 of notes and accepted $694,457,000 of the notes for purchase, according to a company news release.

A tender offer for the notes began May 4 and ended at 8 a.m. ET on June 6.

The cap on the offer was increased to $694,457,000 from $691,233,000. It was previously increased from $500 million.

The company offered to purchase:

• Any and all of its $180,568,000 of 7.75% senior notes due 2012. Holders tendered $94,252,000 principal amount, all of which was accepted. The purchase price is $1,065.75 per $1,000 principal amount;

• Any and all of subsidiary Crum & Forster Holdings Corp.'s $330 million of 7.75% senior notes due 2017. Holders tendered $323.81 million principal amount, all of which was accepted. The purchase price is $1,075.20;

• Up to $234,222,000 of Fairfax's $282,625,000 of 7.75% senior notes due 2017. Holders tendered $234,222,000 principal amount, all of which was accepted. The purchase price is $1,113.10;

• Up to $90 million of subsidiary Odyssey Re Holdings Corp.'s $225 million of 7.65% senior notes due 2013. Holders tendered $42,173,000 principal amount, all of which was accepted. The purchase price is $1,135.00;

• Up to $45 million of Odyssey's $125 million of 6.875% senior notes due 2015. Holders tendered $16.35 million principal amount, none of which was accepted. The purchase price would have been $1,146.25; and

• Up to $30 million of Fairfax's $90,864,000 of 8.25% senior notes due 2015. Holders tendered $53,541,000 principal amount, none of which was accepted. The purchase price would have been $1,175.00.

The notes are listed in order of acceptance priority level.

The purchase prices noted above include a $30.00 early tender payment for each $1,000 principal amount of notes tendered by 5 p.m. ET on May 17, the early tender date. The company will also pay accrued interest.

The settlement date was May 19 for $92,318,000 of Fairfax's 7.75% notes due 2012 and $323,765,000 for Crum & Forster's 7.75% notes. The settlement date will be June 7 for the remaining notes.

When the offer began, the company expected to accept up to $80 million of its 7.75% notes due 2012, up to $120 million of its 7.75% notes due 2017 and up to $135 million of Crum & Forster's 7.75% notes. Later, the cap for the 7.75% notes due 2017 was increased and the caps for the two other series were removed.

Bank of America Merrill Lynch (888 292-0070 or 980 388-9217) was the lead dealer manager. Global Bondholder Services Corp. (866 387-1500) was the depositary and information agent.

Toronto-based Fairfax provides property and casualty insurance and reinsurance and investment management services.

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