Fortis proposes to liquidate its sub-holding Fortis Brussels SA/NV
As a first step towards simplifying its structure, Fortis plans to liquidate its
sub-holding Fortis Brussels SA/NV. Fortis's former structure was designed to
incorporate the banking activities (held through Fortis Brussels) and insurance
activities (held through Fortis Utrecht). Following the sale of the banking
activities, insurance has become the core business of Fortis. The decision to
liquidate Fortis Brussels as a sub-holding reflects this new structure.
The liquidation of Fortis Brussels will have a positive tax impact on Fortis
SA/NV. The company will benefit from an important tax deduction corresponding to
the losses suffered on the disposal of banking assets in October 2008. This tax
loss, currently estimated at EUR 11.6 billion, can be deducted from
Fortis SA/NV's future taxable income including any proceeds from the BNP Paribas
option, which can be exercised as from October 2010. The tax deduction can be
offset against income generated as from the financial year 2010 subject to
Fortis meeting the conditions set out by the Belgian Ruling Commission, which it
expects to fulfil.
As a consequence of this tax deduction Fortis should be able to record a benefit
in its income statement equal to the net deferred tax liabilities on the balance
sheet at the end of the second quarter 2010. At 31 December 2009, the net
deferred tax liabilities of Fortis SA/NV amounted to some EUR 405 million,
including EUR 299 million related to the BNP Paribas option, or 16 Eurocents per
outstanding share. The exact amount of net deferred tax liabilities in the
second quarter 2010 is dependent on the situation at that time, including the
valuation of the BNP Paribas option.
Fortis confirmed in its press release of 27 July 2009 its intention to
distribute any net proceeds from the BNP Paribas option to its shareholders in
the form of a dividend, to the extent allowed by law and taking into account any
other practical constraints The tax deduction ensures that the gross proceeds
from exercising or monetising the BNP Paribas option can be proposed for
distribution.
The proposal to liquidate Fortis Brussels SA/NV was approved by the board of
directors of Fortis Brussels yesterday and will be submitted for approval to
today's extraordinary shareholders' meeting of Fortis Brussels.
Fortis is an international insurance company with a heritage spanning more than
180 years. Ranked among the top 20 insurers in Europe, Fortis has chosen to
concentrate its business activities in Europe and Asia, which together make up
the largest share of the global insurance market. It is an undisputed leader in
the Belgian market for individual life and employee benefits, as well as a
leading non-life player through AG Insurance. Internationally, Fortis has a
strong presence in the UK, where it is the second largest private car insurer.
The company also has subsidiaries in France, Germany, Turkey, Ukraine and Hong
Kong. Fortis has a strong track record in developing partnerships with key
distributors in different markets and successfully operates partnerships in
Luxembourg, Italy, Portugal, China, Malaysia, India and Thailand. Fortis employs
more than 11,000 people and has annual inflows of around EUR 16 billion.
Fortis's assets include a 75% stake in AG Insurance; 100% of Fortis Insurance
International; a 45% stake in Royal Park Investments; and other financial assets
and liabilities of various financing vehicles.
Press Contacts:
Brussels: +32 (0)2 565 22 66
Investor Relations:
Brussels: +32 (0)2 565 53 78 Utrecht: +31 (0)30 226 65 66
[HUG#1402767]
PDF version complete release: http://hugin.info/134212/R/1402767/357225.pdf
