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Lancashire shareholders vote for UK board meetings

Shareholders of Lancashire Holdings Ltd have overwhelmingly backed a change that would allow the Bermuda-based company to hold its board meetings in the UK.

The change to the company’s by-laws, approved by 99.68 percent of the shareholder votes cast, is in anticipation of the switch of the re/insurer’s tax base from Bermuda to Britain, scheduled to take place next year.

In a statement released on Friday, Lancashire said it had “engaged in positive discussions with the UK tax authorities on the proposed move”.

Lancashire chairman Martin Thomas said: “The amendments permitting board meetings to be held in the UK will help the company more effectively benefit from the anticipated move in tax residence at the start of 2012.”

Another resolution, to give Lancashire the authority to sell shares to raise up to $8.43 million in capital, was approved by 95.62 percent of those who voted at the special general meeting, which was held last Thursday.

“The vote permitting the issue of up to 10 percent of shares on a non pre-emptive basis recognises and affirms the approach to capital management that the company has consistently and successfully deployed since its inception in 2005,” Mr Thomas said.

“It gives the company the ability to raise capital rapidly to take best advantage of underwriting opportunities, whilst avoiding the inevitable procedural delay of a UK rights issue.

“This helps place the company on a more even footing with its international competitors, and is an important tool in the company’s capital management strategy.”

Mr Thomas welcomed the votes and added: “The flexibility afforded by these positive votes is a clear benefit to the company going forward.”

When it announced its switch of tax base at the end of last month, Lancashire told this newspaper that it did not expect its tax bill to rise as a result of the move, as it would qualify for a three-year exemption from British rules on the tax treatment of companies with overseas interests, pending their reform.

Lancashire’s Bermuda operation will be largely unaffected by the move, the company said, although some senior group executives might move to London as a result.

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Published August 22, 2011 at 2:00 am (Updated August 22, 2011 at 10:31 am)

Lancashire shareholders vote for UK board meetings

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