Equisure Announces Offer to Acquire Canada Brokerlink
Calgary-based Brokerlink is a publicly traded consolidator of independent property and casualty insurance brokerages and an operator of insurance brokerage firms. It also provides operational services to independent insurance brokers.
Brokerlink has announced that it has entered into a letter of intent pursuant to which Brokerlink and Vector Intermediaries Inc. intend to amalgamate. Brokerlink has announced that the shareholders of Brokerlink will be asked to approve the proposed amalgamation at a meeting scheduled for February 22, 2000.
Equisure plans to take up and pay for the shares acquired pursuant to the offer prior to the meeting. At the Brokerlink shareholder's meeting, Equisure plans to vote any shares acquired pursuant to the offer against the proposed amalgamation.
On December 15, 1999 Equisure advised Brokerlink in writing that it was considering making a public takeover bid for the shares of Brokerlink and by letter dated January 6, 2000 Equisure formally requested a shareholder's list. After the close of business on Friday, January 14, 2000, Brokerlink announced that its board of directors had adopted a shareholders' rights plan.
Brokerlink's statement said, "The Rights Plan will ensure that, if an unsolicited takeover bid is made for Brokerlink prior to the scheduled special meeting for the proposed amalgamation with Vector, Brokerlink's shareholders will have the opportunity to choose between such a takeover bid, the Vector amalgamation and any alternative transaction that may arise before the effective date of the amalgamation." The company added, "It is not the intention of the Rights Plan to prevent take-over bids."
Equisure said that one of the terms of the plan--that any bid must remain open for a period of not less than 45 days—would, unless waived, effectively thwart Equisure's bid.
As a result of the adoption of the shareholder's rights plan by the board of directors of Brokerlink, Equisure's obligation to take up and pay for the shares of Brokerlink will be conditional on any rights issued under the shareholders' rights plan being redeemed or the shareholder's rights plan being waived, cease traded by applicable securities regulation or otherwise rendered inapplicable.
Equisure's obligation to take up and pay for the shares of Brokerlink will also be subject to certain other conditions, including there being validly deposited under the offer and not properly withdrawn common shares of Brokerlink representing, together with the Brokerlink shares held by Equisure, at least two-thirds of the outstanding Brokerlink shares (calculated on a fully diluted basis).
Equisure Financial Network, with 94 offices, is a Canadian general and life insurance and financial service brokerage network.
Brokerlink has constituted a special committee to consider and advise the full board of directors on Equisure's offer, when made, and any other offers that may come from other interested parties. The special committee has engaged Newcrest Capital Inc. to provide financial advice.
On the advice of its advisors, Brokerlink recommends that shareholders not tender their shares into an offer or complete any letters of transmittal until Brokerlink's board of directors has had an opportunity to review and evaluate the offer with its financial and legal advisors, to consider alternatives and to make a recommendation to Brokerlink's shareholders.