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Highfields Capital Management LP

Highfields Capital Releases Statement Regarding Status of Possible Exchange of IRP Shares with SCOR

Boston (ots/PRNewswire)

Highfields Capital Management
("Highfields") today issued a statement  addressing certain incorrect
and incomplete information being disseminated  about the potential
acquisition by SCOR of Highfields' 46.6% ownership of IRP  Holdings
Ltd., an Irish company formed in 2001 for the purpose of reinsuring
part of SCOR's worldwide non-life insurance business.
Contrary to public reports, SCOR will not be acquiring complete
ownership of IRP on May 31, 2005, as a result of SCOR's failure to
satisfy the procedures, and to provide the financial information,
required by the IRP Shareholders Agreement dated December 28, 2001
(the "Agreement"), and which are preconditions to such purchase. SCOR
has failed to fulfill its obligation to provide audited financial
information for the period ended September 30, 2004, to furnish a
required third-party calculation of relevant ratios and exchange
consideration information, and to take other steps necessary to be in
a position to complete a share exchange by the required date of May
31, 2005. As of today, SCOR has not satisfied the requirements
stipulated by the Agreement, and Highfields is not able to predict
when or whether SCOR will be in a position to do so and thus be in a
position to acquire Highfields' shares of IRP.
Also contrary to public reports, Highfields is not engaged in
negotiations with SCOR regarding any agreement under which Highfields
would waive any of its rights or claims in exchange for accepting
SCOR shares in payment for Highfields' IRP interests. Highfields
intends to utilize all of its rights under the Agreement, including
its right under certain circumstances to defer SCOR's acquisition of
Highfields' IRP shares for one year, until May 31, 2006.
Though SCOR has not fulfilled the Agreement's exchange procedure
requirements, Highfields has been informed of preliminary and
unofficial indications that Highfields will have the right to defer
the exchange, and that the share exchange ratio will be established
by reference to the market price of SCOR shares. As Highfields does
not have the required notices or information to evaluate or verify
such conclusion, and believes there may be significant unresolved
questions regarding certain balance sheet items in SCOR's U.S. GAAP
accounts, it has reserved its rights to review and may dispute such
calculations, including calculations of the cash alternative price
available to SCOR. However, taking into account the possibility that
the number of SCOR shares to be offered to Highfields ultimately will
be established by reference to the market price of SCOR shares, and
in order to assure the integrity of the exchange ratio calculation,
Highfields will request that market regulatory authorities closely
monitor trading in SCOR shares in the period leading up to the
possible exchange and scrutinize any transactions that appear to
affect the exchange ratio calculation.
The Agreement stipulates that the closing will be held only after
a series of prescribed notices, exchanges of information and
applicable waiting periods, or five (5) business days after all
necessary regulatory approvals for the transaction have been
satisfied, at which time Highfields will determine whether or not to
defer the exchange until May 31, 2006. Highfields intends to make
such deferral determination at such time based on a variety of
factors including the market price of SCOR shares applicable to the
exchange, financial results of SCOR for the first quarter of 2005,
the number of SCOR shares proposed to be issued to Highfields, and
the market value of SCOR shares as of the date of such closing.
Finally, whether or not the sale of Highfields' IRP shares to SCOR
is completed in 2005, Highfields intends to vigorously pursue its
claims against SCOR in the United States District Court for
Massachusetts. In such action, Highfields alleges that SCOR
fraudulently induced Highfields to invest in and fund IRP through
omissions and misrepresentations about SCOR's financial condition
leading up to Highfields' December 28, 2001 investment in IRP. As
described in the Complaint, within eleven business days of such
closing, on January 15, 2002, SCOR reported for the first time that
"In December, 2001, SCOR received an exceptional number" of large
fourth quarter loss advisories, and that other information received
in "early December onwards" required that SCOR sharply revise its
2001 projected earnings to an estimated loss of EUR 250 million. In
that United States Court Action, which will be tried in front of a
Massachusetts jury, Highfields has made claims for fraud, negligent
misrepresentation, and violation of the Massachusetts statute against
unfair and deceptive business practices under which it is entitled to
recover its out-of-pocket expenses, the benefit of its bargain and
its lost profits as well as treble damages and its attorneys fees. As
required by the Court, Highfields submitted a settlement demand to
SCOR on February 15, 2005, for US$382 million, to which SCOR did not
respond.
About Highfields Capital Management: Highfields Capital Management
is a Boston-based investment management firm, established in 1998,
that primarily makes long-term equity investments in securities of
both public and private companies. Highfields manages approximately
US$6.8 billion in investment funds on behalf of charitable
foundations, school endowments and other institutional and private
investors. http://www.highfieldscapital.com
Web site: http://www.highfieldscapital.com

Contact:

Daniela Messina of Weber Shandwick, +1-781-888-2217, U.S., or
+1-617-520-7057, U.S., dmessina@webershandwick.com for Highfields
Capital Management