Cunningham Lindsey Group Inc.

Cunningham Lindsey Group Inc.
Fairfax Financial Holdings Limited

Fairfax Financial Holdings Limited

December 31, 2007 14:48 ET

Fairfax and Stone Point Close the Transaction Regarding Cunningham Lindsey

TORONTO, ONTARIO--(Marketwire - Dec. 31, 2007) -

(Note: All dollar amounts are in Canadian dollars.)

Fairfax Financial Holdings Limited (TSX:FFH)(NYSE:FFH) ("Fairfax") and Cunningham Lindsey Group Inc. ("Cunningham Lindsey") announce that on December 31, 2007 they closed the transaction pursuant to an agreement with Trident IV, L.P., a private equity fund managed by Stone Point Capital LLC, and certain affiliated entities (collectively "Stone Point"). Pursuant to the agreement, Stone Point acquired for approximately $88 million a 51% interest in a newly-formed holding company that owns the operating businesses of Cunningham Lindsey. Fairfax invested approximately $35 million and senior management of Cunningham Lindsey and its operating companies invested as well. The proceeds from these investments were used to repay Cunningham Lindsey's $72.8 million unsecured term loan facility and for working capital.

In order to satisfy the condition to the Stone Point investment that Fairfax be the sole shareholder of Cunningham Lindsey, Fairfax acquired all of the outstanding subordinate voting shares of Cunningham Lindsey which it had not previously owned. Upon completion of the foregoing going-private transaction and completion of the above-mentioned investments, Fairfax holds an approximately 45% interest in the operating companies of Cunningham Lindsey through its 100% ownership of Cunningham Lindsey, and senior management of Cunningham Lindsey and its operating companies hold an approximately 4% interest in these operating companies.

On completion of the transaction on December 31, 2007, Cunningham Lindsey's $125.0 million of 7% unsecured Series "B" debentures due June 16, 2008 remain outstanding.

About Fairfax

Fairfax Financial Holdings is a financial services holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance, investment management and insurance claims management.

About Cunningham Lindsey

Cunningham Lindsey Group is one of the leading insurance loss-adjusting groups worldwide. Through its operating subsidiaries, Cunningham Lindsey Group provides a wide range of independent insurance claims services, including claims adjusting, appraisal and claims and risk management. It has a global network of approximately 4,000 professionals located in 357 locations throughout Canada, the United States, the United Kingdom, continental Europe, the Far East, Latin America and the Middle East. Beyond its core loss adjusting services, Cunningham Lindsey Group provides engineering consultancy, risk management, risk surveys, environmental remediation, valuations and related services as well as claims appraisal training and education courses in the United States.

Forward-Looking Information

The matters discussed in this release include certain forward-looking statements. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future plans, intentions, levels of activity, results, performance or achievements. Forward-looking statements may be identified, without limitation, by the use of such words as "may", "will", "should", "would", "could", "anticipates", "estimates", "expects", "intends", "plans", "predicts", "projects", "believes", or words or phrases of similar meaning or negative derivations thereof. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, achievements or other future events. Readers should not rely on forward-looking statements as they involve known and unknown risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed, implied or anticipated in the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to the following factors: the satisfaction of the conditions to consummate the proposed transaction, including the approval by shareholders; the occurrence of any event, change or other circumstance that could give rise to the termination of the agreement providing for the proposed transaction; the delay of the consummation of the proposed transaction or the failure to complete the proposed transaction for any other reason; and the amount of the costs, fees and expenses related to the proposed transaction. We have no obligation, and do not intend, to update or alter such forward-looking statements as a result of new information, future events or otherwise, except as required by law.

Contact Information

  • Fairfax Financial Holdings Limited
    Greg Taylor
    Chief Financial Officer
    (416) 367-4941
    Cunningham Lindsey Group Inc.
    Jan Christiansen
    President and Chief Executive Officer
    (847) 517-3300 Ext. 3333