Letter to market heads follows profit warning by 50% shareholder
Xchanging Insurance Services (XIS) chairman Richard Bucknall has written to several London market heads to assure them that the firm could buy out its 50% shareholding “in the unlikely event that any shareholder ceases as a going concern”.
Bucknall also assured them that XIS was a separate company and legal entity to Xchanging, which issued a trading update last week announcing a profit warning, goodwill and fair-value impairments and the departure of chief executive David Andrews.
The letter, revealed online by insurancetimes.co.uk, is addressed to Lloyd’s chief executive Richard Ward, Lloyd's Market Association chairman Barnabas Hurst-Bannister, International Underwriting Association chairman Stephen Riley and London & International Insurance Brokers’ Association chief executive David Hough.
XIS, a London market insurance back-office provider, is 50% owned by Xchanging. Lloyd’s and the International Underwriting Association own 25% each.
Bucknall added that the XIS audit committee met with Xchanging’s auditors, PricewaterhouseCoopers, on Thursday, and was satisfied that “the cash position is satisfactory”.
Xchanging’s share price has halved over the past week from 116p to 56p.