Lombard Group puts reverse takeover deal to shareholders

The Lombard Group, parent of failed Lombard Finance, will go to its shareholders this week with details of a reverse takeover deal that could result in it being 98.5 per cent owned by the shareholders of Perth-based insurer Australian Consolidated Insurance.

The deal has obtained approval from NZX and is subject to approval from Lombard shareholders, who will be posted details of the deal this week, Lombard told NZX yesterday.

Details of the shareholder meeting, including the resolutions which comprise the transaction, are expected to be announced tomorrow.

ACIL is an insurance broking and underwriting agency which bought Hamilton-based underwriter Classic Cover Insurance in June last year. It manages more than A$80 million ($98.42 million) of insurance premiums from offices in Perth, Sydney, Melbourne, Brisbane, Auckland and Hamilton.

Under the reverse takeover deal, Lombard proposes to make a takeover offer to ACIL shareholders for all ACIL's 42.8 million shares. It will then offer 1.48 billion new shares in Lombard as consideration for the ACIL shares, or 34.6 Lombard shares for each ACIL share.

If the takeover offer is successful, Lombard would make a buy-back offer of 1.196 cents a share. Lombard shareholders can choose to accept all or part of the buy-back offer.

- NZPA