Swiss Re shareholders approve capital to buy GE Insurance

Shareholders of Swiss Reinsurance Co. (RUKN.VVX) recently approved the creation of up to $7.8 billion in fresh equity capital that will be used to finance the acquisition of GE Insurance Solutions, the reinsurance unit of General Electric Co (GE).
Chairman of the board of directors Peter Forstmoser says the vote indicates that shareholders are convinced of the strategic and financial benefits of the GE Insurance Solutions acquisition.
“The transaction will allow Swiss Re to further enhance its already strong global market position,” Forstmoser explains.
The shareholder vote to approve the creation of authorized nominal share capital of CHF6 million was reached at Swiss Re’s extraordinary general meeting, recently held in Zurich.
The shareholders also approved the creation of authorized capital for share issues with shareholders’ subscription rights of up to 30 million Swiss RE shares.
In addition, shareholders followed proposals to create conditional capital of up to nine million shares in favor of General Electric and to increase conditional capital for bonds or similar instruments by 11 million shares.
As a result of the transaction, Swiss Re says that as of the closing of the transaction, General Electric will become their largest shareholder owning between 10% and 13% of the reinsurer’s share capital.
The number of shares Swiss Re issues will depend on the ultimate purchase consideration to General Electric and prevailing market conditions at the time of the closing, which is expected by mid-2006.