TORONTO, Oct. 17, 2011 /CNW/ - (TSX: KFS, NYSE: KFS) Kingsway Financial
Services Inc. ("Kingsway" or the "Company") today announced a
settlement and release ending all legal disputes between the Company
and the Pennsylvania Insurance Department (the "Department"). As
previously disclosed, the Department sued the Company and twenty
different charities on November 20, 2009, after Kingsway disposed of
its interest in Walshire Assurance Company ("Walshire") and Lincoln
General Insurance Company ("Lincoln General") in October 2009 by
donating its Walshire shares to the charities. On April 1, 2010, the
Department's claims that the disposition was improper were dismissed,
but the Department appealed to the Pennsylvania Supreme Court. The
settlement between the parties was reached after nearly a year of
negotiations and includes a mutual release of claims arising out of
Kingsway's prior 100% ownership and renewed minority ownership, as
described below, of Walshire and Lincoln General, as well as claims
relating to the original disposition in October 2009.
Kingsway also announced that LGIC Holdings, LLC ("LGIC Holdings") has
completed its previously announced acquisition of Walshire. Regulatory
approval for the change in control of Walshire was obtained October 6,
2011. LGIC Holdings is a joint endeavor between Kingsway, the 49%
owner member, and Tawa plc ("Tawa"), the 51% owner member. Day-to-day
management of Walshire and Lincoln General will be performed by the
Tawa group subject to the oversight of the companies' boards of
directors. As a minority and non-controlling investor, Kingsway will
not consolidate Walshire or Lincoln General but will account for its
investment using the equity accounting method. At closing, Kingsway
also obtained releases from Walshire, Lincoln General and the twenty
charities.
About the Company
Kingsway focuses on non-standard automobile insurance in the United
States of America. The Company's primary businesses are the insuring of
automobile risks for drivers who do not meet the criteria for coverage
by standard automobile insurers. The common shares of the Company are
listed on the Toronto Stock Exchange and the New York Stock Exchange
under the trading symbol "KFS".
Forward Looking Statements
This press release includes "forward looking statements" that are
subject to risks and uncertainties. Such forward looking statements
relate to future events or 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. For information
identifying important factors that could cause actual results to differ
materially from those anticipated in the forward looking statements,
see Kingsway's securities filings, including its 2010 Annual Report
under the heading Risk Factors in the Management's Discussion and
Analysis section. The securities filings can be accessed on the
Canadian Securities Administrators' website at www.sedar.com, on the EDGAR section of the U.S. Securities and Exchange Commission's
website at www.sec.gov or through the Company's website at www.kingsway-financial.com. 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.