Markel CATCo funds seek US bankruptcy support for buyout

The Markel CATCo retrocessional reinsurance investment funds are seeking support from the US bankruptcy courts for the proposed buyout schemes, which is seen as a precondition for the buyout proceedings moving forwards.

In a Chapter 15 filing, Markel CATCo is seeking recognition and enforcement of the Schemes of Arrangement in the United States as a condition precedent to completion of the proposed Buy-Out Transaction.

This is to head off the potential for additional litigation, by binding the buyout schemes to the US bankruptcy protections, granting full force and effect of the proposed Bermuda schemes, while issuing an injunction that would enjoin any actions that might hinder implementation of the schemes, or are inconsistent with them, while affording additional bankruptcy court protection.

Previously, a judge in the United States Bankruptcy Court for the Southern District of New York granted Markel CATCo’s petition for Chapter 15 bankruptcy recognition and relief for the proposed buyout process for the final winding down of the CATCo retrocessional reinsurance funds.

The latest filing seeks approval for the bankruptcy protection and relief to be applied to the updated schemes, including the latest and improved buyout terms.

A court hearing on March 16th will consider the relief requested.

The goal is to ensure no party can undermine the proposed buyout and so the process can be sped to conclusion, with the added protection of the US bankruptcy court and its protection.

This may be a final test of investor support, as if the bankruptcy hearing goes ahead without objection, this could finalise the scheme of arrangement and mean Markel can proceed towards the final buying out of investors at greater pace.

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