Exhibit (c)(iv)
| | STRICTLY PRIVATE & CONFIDENTIAL | DRAFT - CONFIDENTIAL |
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BANKING |
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Project Elk
Discussion Materials
Goldman Sachs & Co. LLC
April 8, 2024
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| Disclaimer | INVESTMENT
BANKING |
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| Overview of Stork Revised Proposal
(Apr-2024) Summary of Key Changes vs. Original Proposal (Mar-2024) | INVESTMENT
BANKING |
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| | Original Proposal (Mar-2024) | | Revised Proposal (Apr-2024) |
Aggregate
Consideration1 | $4.948bn | | $5.100bn |
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Pre-Closing
Dividend | $750mm | | $500mm |
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| Advisors | ■ Hired Simpson Thatcher (M&A), Willkie Farr & Gallagher (regulatory), Cleary Gottlieb Steen & Hamilton (funds) as legal advisors, Oliver Wyman as actuarial advisor, and EY and KPMG as accounting / tax advisors ■ Yet to finalize financial advisor(s) | | ■ Hired JP Morgan and Ardea as financial advisors, Simpson Thatcher (M&A), Willkie Farr & Gallagher (regulatory), Cleary Gottlieb Steen & Hamilton (funds) as legal advisors, Oliver Wyman as actuarial advisor, and EY and KPMG as accounting / tax advisors |
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| Exclusivity | ■ N/A | | ■ Request to engage in exclusivity through 09-May-2024 ■ Request no go-shop provision |
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| Due Diligence | ■ Confirmatory in nature only given significant due diligence completed when making initial investment in Elk ■ Key areas include refresh of reserve adequacy analysis, review of latest asset tape, marks of illiquid and semi-liquid assets, reinsurance trust investment guidelines, quality of earnings review, and customary financial / operational / accounting / tax / legal / regulatory due diligence | | ■ Confirmatory in nature only given significant due diligence completed when making initial investment in Elk ■ Key areas include refresh of reserve adequacy analysis, review of latest asset tape, marks of illiquid and semi-liquid assets, reinsurance trust investment guidelines, quality of earnings review, and customary financial / operational / accounting / tax / legal / regulatory due diligence ■ Review ability of Elk’s plan around a $500mm capital distribution in 2024 ■ Engage with BMA and Rating Agencies with respect to the ability to distribute capital to shareholders before the closing of the transaction |
Source: Stork IOI submitted on 24-Mar-2024, Stork Revised IOI submitted on 07-Apr-2024.
1 Inclusive of pre-closing dividend.
| Summary of Key Economic Terms Stork Apr-2024 Revised Proposal vs. Mar-2024 Proposal | ($ in millions) | INVESTMENT
BANKING |
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| Analysis at Various Prices | | | | |
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| Consideration Paid by Stork | | | $ 4,198 | $ 4,600 | $ 4,606 | $ 4,621 | $ 4,637 | $ 4,652 | $ 4,668 | $ 4,683 | $ 4,699 | | | | |
| Pre-Closing Dividend | | | 750 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | 500 | | | | |
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| Total Equity Purchase Price | | | $ 4,948 | $ 5,100 | $ 5,106 | $ 5,121 | $ 5,137 | $ 5,152 | $ 5,168 | $ 5,183 | $ 5,199 | | | | |
| Implied Purchase Price Per Share¹ | | | $ 326.83 | $ 336.62 | $ 337.00 | $ 338.00 | $ 339.00 | $ 340.00 | $ 341.00 | $ 342.00 | $ 343.00 | | | | |
| | | | | | | | | | | | | | Reference Valuation |
| | | | | | | Multiple | | | | | | Peer Trading Comparables | |
| | | | Original Bid | Revised Bid | | | | | | | | | Traditional | Other | |
| | | | Price | Price | | | | | | | | | Bermuda | Bermuda | Precedent |
| Metric | Value | Current | (24-Mar-24) | (07-Apr-24) | Illustrative Bid Price Sensitivity | | Reinsurers² | Reinsurers³ | Transactions |
| Implied Purchase Premiums | | | | | | | | | | | | | | | |
| Day Before Stork Original Letter (22-Mar-2024) | $ 292.50 | - | 11.7 % | 15.1 % | 15.2 % | 15.6 % | 15.9 % | 16.2 % | 16.6 % | 16.9 % | 17.3 % | | | | |
| Current Share Price | 294.08 | - | 11.1 | 14.5 | 14.6 | 14.9 | 15.3 | 15.6 | 16.0 | 16.3 | 16.6 | | | | |
| All-Time-High (28-Mar-2024) | 310.76 | | 5.2 | 8.3 | 8.4 | 8.8 | 9.1 | 9.4 | 9.7 | 10.1 | 10.4 | | | | |
| 52-Week-High (28-Mar-2024) | 310.76 | - | 5.2 | 8.3 | 8.4 | 8.8 | 9.1 | 9.4 | 9.7 | 10.1 | 10.4 | | | | |
| 52-Week-Low (20-Oct-2023) | 232.05 | - | 40.8 | 45.1 | 45.2 | 45.7 | 46.1 | 46.5 | 47.0 | 47.4 | 47.8 | | | | |
| 30-Day VWAP | 298.68 | - | 9.4 | 12.7 | 12.8 | 13.2 | 13.5 | 13.8 | 14.2 | 14.5 | 14.8 | | | | |
| 60-Day VWAP | 293.11 | - | 11.5 | 14.8 | 15.0 | 15.3 | 15.7 | 16.0 | 16.3 | 16.7 | 17.0 | | | | |
| 90-Day VWAP | 285.85 | - | 14.3 | 17.8 | 17.9 | 18.2 | 18.6 | 18.9 | 19.3 | 19.6 | 20.0 | | | | |
| VWAP Since Stork Investment (08-Nov-2023) | 284.00 | - | 15.1 | 18.5 | 18.7 | 19.0 | 19.4 | 19.7 | 20.1 | 20.4 | 20.8 | | | | |
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| Implied Price / Book Value Multiples | | | | | | | | | | | | | | | |
| YE 2023 Book Value (incl. AOCI) | $ 5,025 | 0.87 x | 0.98 x | 1.01 x | 1.02 x | 1.02 x | 1.02 x | 1.03 x | 1.03 x | 1.03 x | 1.03 x | | 1.23 x | 0.78 x | 1.09 x |
| YE 2023 Book Value (excl. AOCI) | 5,361 | 0.82 | 0.92 | 0.95 | 0.95 | 0.96 | 0.96 | 0.96 | 0.96 | 0.97 | 0.97 | | 1.14 | 0.78 | 1.18 |
| YE 2023 Book Value (Management Adjusted)4 | 5,391 | 0.81 | 0.92 | 0.95 | 0.95 | 0.95 | 0.95 | 0.96 | 0.96 | 0.96 | 0.96 | | - | - | - |
| Q1'24 Preliminary Book Value (incl. AOCI) | 5,092 | 0.86 | 0.97 | 1.00 | 1.00 | 1.01 | 1.01 | 1.01 | 1.01 | 1.02 | 1.02 | | - | - | 1.09 |
| Q1'24 Preliminary Book Value (excl. AOCI) | 5,459 | 0.80 | 0.91 | 0.93 | 0.94 | 0.94 | 0.94 | 0.94 | 0.95 | 0.95 | 0.95 | | - | - | 1.18 |
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| Implied Price / Tangible Book Value Multiples | | | | | | | | | | | | | | | |
| YE 2023 Tangible Book Value (incl. AOCI) | $ 4,962 | 0.88 x | 1.00 x | 1.03 x | 1.03 x | 1.03 x | 1.04 x | 1.04 x | 1.04 x | 1.04 x | 1.05 x | | 1.27 x | 0.78 x | 1.11 x |
| YE 2023 Tangible Book Value (excl. AOCI) | 5,298 | 0.83 | 0.93 | 0.96 | 0.96 | 0.97 | 0.97 | 0.97 | 0.98 | 0.98 | 0.98 | | 1.18 | 0.78 | - |
| YE 2023 Tangible Book Value (Management Adjusted)4 | 5,328 | 0.82 | 0.93 | 0.96 | 0.96 | 0.96 | 0.96 | 0.97 | 0.97 | 0.97 | 0.98 | | - | - | - |
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| Implied Price / Management Projected Earnings Multiples | | | | | | | | | | | | | | | |
| 2024E Earnings - Per Management | $ 659 | 6.7 x | 7.5 x | 7.7 x | 7.7 x | 7.8 x | 7.8 x | 7.8 x | 7.8 x | 7.9 x | 7.9 x | | 6.3 x | 6.6 x | - |
| 2025E Earnings - Per Management | 572 | 7.7 | 8.7 | 8.9 | 8.9 | 9.0 | 9.0 | 9.0 | 9.0 | 9.1 | 9.1 | | 5.9 | 7.1 | - |
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Source: Elk Management preliminary projections, FactSet as of 05-Apr-2024, Company filings. ¹ Based on Elk computed diluted shares outstanding inclusive of ordinary shares, non-voting ordinary shares, RSUs, PSUs and JSOP shares as of Q1’24. Analysis accounts for share count dilution applied to valuation range. 2 Traditional Bermuda Reinsurers include Everest Re, RenaissanceRe, Axis Capital, and Fidelis. 3 Other Bermuda Reinsurers include Hamilton, Greenlight Re and SiriusPoint.
4 Adjusted for net realized and unrealized gains / (losses) on fixed maturities available for sale, fixed maturities trading, and funds held, change in fair value of insurance contracts, and amortization of fair value adjustments.
| Summary Per Share Metrics ($ in millions, except per share metrics) | INVESTMENT
BANKING |
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| Early Look Q1 Aggregate Book Value | $5,092 |
| Aggregate Purchase Price | 5,100 |
| % of Book Value | 100.1% |
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| Diluted Shares (excluding JSOP basis) | 14.982 |
| Q1 BVPS (excluding JSOP basis) | $339.91 |
| Purchase Price Per Share (excluding JSOP basis) | 340.41 |
| Increase / (Decrease) from Q1 BVPS | 0.51 |
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| Diluted Shares (including JSOP basis) | 15.151 |
| Q1 BVPS (including JSOP basis) | $336.12 |
| Purchase Price Per Share (including JSOP basis) | 336.62 |
| Increase / (Decrease) from Q1 BVPS | 0.50 |
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| Note: Draft fully diluted share count is a current estimate | |
| at this time and subject to change. | |
Source: Elk management
| Detailed Equity Capitalization and
Share Count Table | INVESTMENT
BANKING |
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| | Q1'24 Change of | | |
| Security Type | Control | Q1'24 Standalone | YE 2023 Standalone |
| Voting Ordinary Shares | 14.631 | 14.631 | 14.631 |
| Restricted Stock Units | 0.154 | | |
| Performance Stock Units | 0.095 | 0.351 | 0.292 |
| Director Share Units | 0.051 | | |
| Joint Share Ownership Plan (Treasury Stock Method) | 0.220 | - | - |
| Fully Diluted Shares Outstanding | 15.151 | 14.982 | 14.923 |
Source: Elk management, company filings as of YE 2023. Note: Based on Stork’s stated offer price of $5.1bn.
| Q1’24 Preliminary Book Value Walk ($ in millions, except per share metrics) | INVESTMENT
BANKING |
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| | | Book Value | Fully Diluted | BVPS | | Book Value | Fully Diluted | BVPS |
| | | (incl. AOCI) | Shares | (incl. AOCI) | AOCI | (excl. AOCI) | Shares | (excl. AOCI) |
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| | Q4 2023: As Stated | $5,025 | 14.923 | $336.72 | ($336) | $5,361 | 14.923 | $359.24 |
 | Q1'24 Technical Income | $12 | - | | | $12 | - | |
| Q1'24 Change in Fair Value Adjustment | 20 | - | | | 20 | - | |
| Q1'24 Total Investment Return | 200 | - | | (31) | 231 | - | |
| Q1'24 Expenses, Interest on Debt, Div on Pref | (150) | - | | | (150) | - | |
| Other: Change in Monument Carrying Value | (15) | - | | | (15) | - | |
| Change in Diluted Shares | - | 0.058 | | | - | 0.058 | |
| | Q1 2024 "Early Look": As Stated | $5,092 | 14.982 | $339.91 | ($367) | $5,459 | 14.982 | $364.40 |
Source: Elk management, company filings as of YE 2023.
