June 08, 2009 02:08 ET

Fortis holding statement in respect of preference shares issued by Fortis Capital Company Limited in 1999*

BRUSSELS, BELGIUM--(Marketwire - June 8, 2009) -

Fortis Capital Company Limited ("FCCL"), Fortis Bank Nederland (Holding) N.V. ("FBNH") and their common shareholder the Dutch State challenge the agreed compensation arrangements in favor of Fortis holding in respect of the Cash Settlement** scheduled for 29 June 2009.

Fortis holding refers to its press release of 27 March 2009 in respect of the decision by FCCL not to cancel its outstanding Class A1 preference shares (ISIN code GB0057047275) on 29 June 2009.

Following this decision, holders representing a principal amount of EUR 362.5 million made use of their option to elect Stock Settlement*** and to convert their Class A1 preference shares into ordinary Fortis shares.

Fortis holding in turn received permission from its regulator for Cash Settlement as foreseen under the terms of the instrument. FCCL subsequently confirmed that the Class A1 preference shares for which conversion has been asked will be redeemed in cash by FCCL on 29 June 2009.

Under arrangements put in place at the time of issuing the instrument in 1999, Fortis SA/NV and Fortis N.V. are to receive simultaneous compensation in the form of new shares to be issued by FBNH when meeting their obligations towards FCCL in the framework of Cash Settlement.

The Stock/Cash Settlement mechanism as originally foreseen was only meant to be used in the extreme situation that FBNH would be insufficiently capitalized to call the securities on 29 June 2009.

Instead of ensuring that FBNH is adequately capitalized to allow it to call the Class A1 preference shares, the Dutch State chose not to follow this route and instead demands pursuant to the Support Agreement that the Fortis parents provide FCCL with EUR 362.5 million in cash to perform Cash Settlement. Simultaneously, however, it refuses to accept the consequences of its decision and to provide Fortis with the necessary compensation.

Fortis holding understands the reluctance of the Dutch State to see Fortis re-enter the capital of FBNH, however, this is the pre-agreed result of its decision not to call the instrument. Fortis holding stresses that it remains open to discuss any acceptable alternative form of compensation.

FCCL is expected today to file summary proceedings to claim EUR 362.5 million in cash from Fortis holding without accepting any compensation rights.

Fortis holding will challenge this position and will do whatever appropriate to make sure that its legitimate rights and the interests of its shareholders are protected. It is conscious of the concerns that this situation might raise with the holders of the Class A1 preference shares. Fortis holding fully acknowledges the rights of the holders in respect of the Cash Settlement and stresses its willingness to honour its obligations in this respect.

*Fortis Capital Company Limited is a Jersey company, 100% owned by Fortis Bank Nederland (Holding) N.V. It was incorporated in 1999 and issued EUR 450,000,000 Class A1 preference shares for the purpose of strenghtening the Tier 1 capital of Fortis Bank Nederland (Holding) N.V. Since the break-up of the Fortis group in October 2008, Fortis Capital Company Limited is indirectly owned by the Dutch State.

** Redemption on demand of the holders through delivery by Fortis holding to FCCL of cash.

*** Redemption on demand of the holders through delivery by Fortis holding to FCCL of new shares.

Fortis holding (Fortis SA/NV and Fortis N.V.) consists of (1) a 75% ownership of Fortis Insurance Belgium (2) Fortis Insurance International, (3) a 45% stake in Royal Park Investments - a structured credit portfolio entity - and (4) financial assets and liabilities of various financing vehicles. Fortis Insurance Belgium is overall market leader and a leading player in the Employee Benefits market. The international insurance activities (Fortis Insurance International) are located in the UK, where Fortis is the third largest player in the market for private car insurance, France, Hong Kong, Luxembourg (Non-Life), Germany, Turkey, Russia, Ukraine and joint ventures in Luxembourg (Life), Portugal, with Millenniumbcp Fortis being a clear market leader, China, Malaysia, India and Thailand. Fortis currently employs over 10,000 people.

Press Contacts:

+32 (0)2 228 82 92 Utrecht: +31 (0)30 226 32 61

Investor Relations:

+32 (0)2 565 53 78 Utrecht: +31 (0)30 226 65 66

This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.

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