Sagicor Financial Corporation (SFC) is on the verge of a “critical” organisational restructuring as it moves to improve its credit rating.
On June 8 the regional financial services giant will seek shareholder approval for its planned re-domiciliation to Bermuda. This move to the A+ (positive outlook) jurisdiction is intended to shore up its credit rating whichever country is its registered domicile.
However, SFC’s principals are not ending their effort there. So long as shareholders say yes to the shift to Bermuda, Sagicor Financial Corporation will become Sagicor Financial Corporation Limited and a corporate reorganisation will follow.
The company shared details of the changes in a 132-page notice to shareholders.
“As part of the effort to improve the rating and streamline the corporate organisation of our operating subsidiaries, SFC intends to reorganise its ownership of a number of key businesses so that those businesses are in operating subsidiaries owned directly by SFC,” it said.
“This will be achieved by moving assets that are currently branches of Sagicor Life Inc. into separate operating subsidiaries incorporated in the relevant jurisdiction and owned directly by SFC and by restructuring share ownership of other operating subsidiaries from Sagicor Life Inc. to SFCL.”
The company’s top brass said the restructuring was being pursued because “we believe (and have discussed with the rating agencies) that the restructuring of our corporate organisation is a critical part of improving our rating”.
“This restructuring will enable the SFC group of companies to improve its management of capital. The capital requirements of the life insurance subsidiaries will be separated and managed independent of the non-life insurance subsidiaries and will allow for more efficient regulatory oversight of the business,” the company explained.
It said the restructuring “will also simplify the management of capital flows to and from SFC as the ultimate parent”.
SFC has already “moved the branches that do business in the Eastern Caribbean to a new company registered in St. Lucia (Sagicor Life (EC) Inc.)” that it owns.
Once the redomiciliation to Bermuda is finished, SFC will make a number of entities it has a stake in “direct subsidiaries of the continued SFC”
The companies include LOJ Holdings Ltd, Sagicor Group Jamaica Ltd., Sagicor General Insurance Inc., Nationwide Insurance Co Ltd.(Trinidad and Tobago), Sagicor Life Aruba NV, Sagicor Curacao Co., Sagicor Belize Co., and FamGuard Corporation Ltd.
As stated previously by SFC officials, the shift from Barbados to Bermuda will have no impact on its companies and staff, including local operations.
“Since SFC will be registered as an exempt company under the Bermuda Companies Act 1981, all that the continued SFC will need is a resident representative, which it will arrange. No physical relocation of any of SFC’s business to Bermuda is required. Additionally, the continued SFC will have a registered office in Bermuda,” the company told shareholders.
