HAMILTON, Bermuda, June 14, 2011 (GLOBE NEWSWIRE) -- Enstar Group Limited (Nasdaq:ESGR) today announced that it has entered into a new three-year $250 million revolving credit facility (the "Credit Facility") with National Australia Bank Limited and Barclays Corporate, the corporate banking division of Barclays Bank PLC. Enstar is permitted to use the borrowings under the Credit Facility to prepay certain existing credit facilities, to fund permitted acquisitions and for general corporate purposes. Enstar's ability to draw on the Credit Facility is subject to customary conditions. In addition, as a condition to Enstar's initial borrowing under the Credit Facility, Enstar must prepay approximately $167 million outstanding under existing credit facilities.
The Credit Facility is secured by a first priority lien on the stock of certain of Enstar's subsidiaries and certain bank accounts held with Barclays Bank PLC in the name of Enstar and into which amounts received in respect of any capital release from certain of Enstar's subsidiaries are required to be paid. The interest rate is LIBOR plus 2.75%, plus an incremental amount tied to certain regulatory costs that may be incurred by the lenders, if any. During the existence of any payment default, the interest rate is increased by 1.0%. The unused portion of the Credit Facility will be subject to a commitment fee of 1.10%. The Credit Facility is subject to various financial and business covenants, including limitations on mergers and consolidations, acquisitions, indebtedness and guarantees, restrictions as to dispositions of stock and dividends, and limitations on liens on stock.
Enstar, a Bermuda company, acquires and manages insurance and reinsurance companies in run-off and portfolios of insurance and reinsurance business in run-off, and provides management, consultancy and other services to the insurance and reinsurance industry.
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This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements regarding the intent, belief or current expectations of Enstar and its management team. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Important risk factors regarding Enstar may be found under the heading "Risk Factors" in Enstar's Form 10-K for the year ended December 31, 2010, and are incorporated herein by reference. Furthermore, Enstar undertakes no obligation to update any written or oral forward-looking statements or publicly announce any updates or revisions to any of the forward-looking statements contained herein, to reflect any change in its expectations with regard thereto or any change in events, conditions, circumstances or assumptions underlying such statements, except as required by law.
CONTACT: Richard J. Harris (441) 292-3645
