OLDWICK, N.J.--(BUSINESS WIRE)--
A.M. Besthasassigned an issuer credit rating of “bbb” to Fairfax
(US) Inc. (headquartered in Delaware), a subsidiary of Fairfax
Financial Holdings Limited (Fairfax) [TSX: FFH and FFH.U] (Toronto,
Canada), and a debt rating of “bbb” to its $300 million 4.875% senior
unsecured notes due 2024. Fairfax is the guarantor of the notes. The
outlook assigned to the ratings is stable.
Fairfax (US) Inc.’s ratings reflect its position as an intermediate
holding company in the Fairfax organization and the implicit and
explicit benefits of being part of the Fairfax enterprise.
It is Fairfax (US) Inc.’s intention to use the net proceeds primarily to
refinance certain indebtedness of Fairfax and its subsidiaries.
Following the notes issue, financial leverage and coverage measures at
Fairfax are expected to remain within A.M. Best’s guidelines for the
In addition, A.M. Best comments that the ratings of Fairfax and its
subsidiaries are unchanged following Fairfax’s disclosure that The
AutoritÉ des marchÉs financiers, the securities regulatory authority in
the Province of Quebec, is conducting an investigation of Fairfax, its
CEO, Prem Watsa, and its President, Paul Rivett. The investigation
concerns the possibility of illegal insider trading and/or tipping (not
involving any personal trading by the individuals) in connection with a
Quebec transaction. A.M. Best will continue to monitor the situation as
further details concerning the investigation are disclosed and will take
future rating actions if warranted.
The methodology used in determining these ratings is Best’s Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best’s rating process and contains the different rating criteria
employed in the rating process. Best’s Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc.ALL RIGHTS
Darian Ryan,908-439-2200, ext. 5449
Lagomarsino, CFA,908-439-2200, ext. 5810
Sharkey, 908-439-2200, ext. 5159
Manager, Public Relations
Peavy, 908-439-2200, ext. 5644
Assistant Vice President,
Source: A.M. Best Company, Inc.