CHICAGO, Dec. 29,
2022 /CNW/ - (NYSE: KFS) Kingsway Financial
Services Inc. ("Kingsway" or the "Company") today announced it
has closed on the sale of the railyard it owns in Texas. TRT Leaseco, LLC, an indirect
subsidiary of the Company and direct owner of the railyard,
completed the sale to BNSF Dayton LLC, who also assumed the
mortgage. The total sales price was $215.2
million – consisting of $44.5
million cash and $170.7
million of mortgage assumption – netting proceeds of
$21.4 million to Kingsway after
taxes, fees and distribution to the minority shareholder.
John T. Fitzgerald, President and
Chief Executive Officer of Kingsway, commented, "The sale of the
railyard is a major milestone in monetizing our legacy assets and
simplifying our balance sheet. With this sale – along with the
previously announced sale of Flower Portfolio – our notes payable
and subordinated debt as of December 31,
2022 will be $183.2 million
lower (or 70%) than it was as of September
30, 2022."
Net proceeds from the sale are expected to be used in
furtherance of exercising Kingsway's options to repurchase its
TruPs subordinated debt and other corporate purposes. Kingsway has
options to repurchase $51.8 million
fair value (or $75.5 million
principal value) of its subordinated debt and $19.2 million of deferred interest (both as of
September 30, 2022) for a total of
$59.4 million. If Kingsway were to
exercise its options in full, then – along with the railyard and
Flower Portfolio sales – the remaining notes payable would be
$16.4 million (value as of
September 30, 2022), which is
non-recourse to Kingsway, and the remaining subordinated debt,
inclusive of deferred interest, would be $14.3 million (value as of September 30, 2022).
About the Company
Kingsway is a holding company that owns or controls subsidiaries
primarily in the extended warranty, business services, asset
management and real estate industries. The common shares of
Kingsway are listed on the New York Stock Exchange under the
trading symbol "KFS."
Forward-Looking Statements
This press release may include "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 that are not
historical facts, and involve risks and uncertainties that could
cause actual results to differ materially from those expected and
projected. Words such as "expects," "believes," "anticipates,"
"intends," "estimates," "seeks" and variations and similar words
and expressions are intended to identify such forward-looking
statements; however, the absence of any such words does not mean
that a statement is a not a forward-looking statement. Such
forward-looking statements relate to future events or future
performance, but reflect Kingsway management's current beliefs,
based on information currently available. A number of factors could
cause actual events, performance or results to differ materially
from the events, performance and results discussed in the
forward-looking statements, including as a result of the COVID 19
pandemic. For information identifying important factors that could
cause actual results to differ materially from those anticipated in
the forward-looking statements, please refer to the section
entitled "Risk Factors" in the Company's 2021 Annual Report on Form
10-K and subsequent Form 10-Qs and Form 8-Ks filed with the
Securities and Exchange Commission. Except as expressly required by
applicable securities law, the Company disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise.
Additional Information
Additional information about Kingsway, including a copy of its
Annual Reports can be accessed on the EDGAR section of the U.S.
Securities and Exchange Commission's website at www.sec.gov, on the
Canadian Securities Administrators' website at www.sedar.com, or
through the Company's website at www.kingsway-financial.com
View original
content:https://www.prnewswire.com/news-releases/kingsway-completes-sale-of-texas-railyard-for-21-4-million-of-net-cash-proceeds-to-the-company-301711209.html
SOURCE Kingsway Financial Services Inc.