Hong Kong’s FWD implements proposals, to settle consent fees Monday

By Marisa Wong

Los Angeles, Aug. 25 – FWD Ltd. and FWD Group Ltd. issued further updates on their consent solicitations launched on June 17, 2021.

The issuers announced on Friday that they have executed and delivered deeds of novation implementing the proposals in respect of six series of notes.

The companies also announced that the settlement date for relevant consent fees is expected to be on Aug. 28.

The settlement conditions to the consent solicitations had been satisfied as of Aug. 24, as announced on Thursday.

FWD Group Holdings Ltd. will assume all rights and obligations as issuer of each of the following six series:

• $325 million 5% notes due 2024 (ISIN: XS1106513762) originally issued by FWD Ltd. (“FWD Ltd. 2024 notes”);

• $200 million 5½% subordinated perpetual capital securities (ISIN: XS1748857379) originally issued by FWD Ltd. (“2018 perpetual securities”);

• $750 million zero-coupon subordinated perpetual capital securities (comprising a $500 million tranche consolidated and forming a single series with a $250 million tranche) (ISIN: XS1628340538) originally issued by FWD Group (“June 2017 perpetual securities”);

• $900 million 5¾% subordinated notes due 2024 (comprising a $550 million tranche and a $250 million tranche consolidated and forming a single series with a $100 million tranche) (ISIN: XS2022434364) originally issued by FWD Group (“FWD Group 2024 notes”);

• $600 million 6 3/8% capital securities (ISIN: XS2038876558) originally issued by FWD Group (“2019 perpetual securities”); and

• $314 million zero-coupon subordinated perpetual capital securities (comprising a $150 million tranche consolidated and forming a single series with a $164 million tranche) originally issued by FWD Group (“November 2017 perpetual securities”).

The deed of novation for the November 2017 perpetual securities was executed separately on Aug. 25, as those securities were not part of the original consent solicitation.

No deed of novation will be executed for the $250 million 6¼% subordinated perpetual capital securities (ISIN: XS1520804250) issued by FWD Ltd. (“2017 perpetual securities”), because that series has already been redeemed in full by FWD Ltd.

Consent fee details

For each of the consent solicitations, the early consent deadline was 11 a.m. ET on June 30, 2021, and the expiration time was 11 a.m. ET on July 6, 2021.

FWD Ltd. will pay consent fees as follows:

• For its 2024 notes, the early consent fee to holders who delivered voting instructions in favor of the extraordinary resolution by the early consent deadline and the expiration time consent fee to holders who delivered voting instructions in favor of the extraordinary resolution by the expiration time; and

• For its 2017 perpetual securities and 2018 perpetual securities, the early consent fee to holders who delivered voting instructions in favor of the extraordinary resolution by the early consent deadline. No consent fees are payable for voting instructions received after the early deadline.

The issuer said that even though the 2017 perpetual securities have been redeemed, holders of that series when it was outstanding will still receive the early consent fee if they had voted in favor of the extraordinary resolution by the early consent deadline.

FWD Ltd. had offered an early consent fee of 0.45% for the 2024 notes, 0.15% for the 2017 perpetuals and 0.45% for the 2018 perpetuals. Originally, the issuer also offered consent fees of 0.1%, 0.05% and 0.1%, respectively, for consents delivered after the early deadline.

FWD Group will pay consent fees as follows:

• For its June 2017 perpetual securities, 2024 notes and 2019 perpetual securities, the early consent fee to holders who delivered voting instructions in favor of the extraordinary resolution by the early consent deadline; and

• For those three series, no consent fees for voting instructions delivered after the early consent deadline.

FWD Group offered an early consent fee of 0.3%. Originally, the company also offered a consent fee of 0.1% for consents delivered after the early deadline.

Hongkong and Shanghai Banking Corp. Ltd. (+852 3941 0223, +44 20 7992 6237, liability.management@hsbcib.com) was the solicitation agent for both consent solicitations.

Morrow Sodali Ltd. (+44 20 8089 3287, +852 2319 4130, fwd@investor.morrowsodali.com, https://bonds.morrowsodali.com/fwd) was the information and tabulation agent.

Hong Kong-based FWD is the insurance business of investment group Pacific Century Group.

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