Boston-based LMG is a leading global insurer and as of December 31, 2005, had $79 billion in consolidated assets, $70 billion in consolidated liabilities and $21 billion in annual consolidated revenue.
The joint venture will have access to considerable funds to invest in this important activity. Faroe Petroleum will play a lead role in bringing suitable opportunities to the joint venture. LEH will initially invest the majority of the joint venture's capital requirements in acquiring any such opportunities. The investment model allows for Faroe to participate with no less than 20% participation in any selected investment opportunities, and with an entitlement to increase its participation to 50% through a pre-agreed option arrangement with LEH.
This innovative new joint venture potentially gives Faroe a significant advantage, in its pursuit of the following key objectives:
Graham Stewart, chief executive of Faroe Petroleum said:
"In the face of increasing competition for attractive lower risk projects, this joint venture represents a very exciting opportunity for Faroe to accelerate value creation in the North Sea. We have designed this new business model to give us an edge in acquiring substantial interests in appraisal and development properties in the UK North Sea, and are delighted to have attracted such a strong and reputable corporation as major co-venturer. We are already considering a number of opportunities together, and look forward to reporting progress in the near term."
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