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Syncora to merge with subsidiary, go into liquidation

Syncora Holdings Ltd. intends to merge with its subsidiary Syncora Holdings US Inc. and adopt a liquidation plan for the company.

Both matters are subject to approval from shareholders at a special general meeting Jan. 28.

Syncora will cancel 3.04 million shares held by Syncora Holdings U.S., which will merge with its parent company prior to liquidation.

In December 2019, the company sold subsidiary Syncora Guarantee Inc. to Star Insurance Holdings LLC for $429 million in cash. The company will distribute the net cash proceeds from the sale and other available cash among shareholders. Syncora Holdings U.S. may also make subsequent liquidating distributions to the company in the future.

The company expects to retain approximately $32 million in cash to satisfy expenses and liabilities. The remaining amount will be distributed among shareholders.

The liquidation process is expected to be completed by the end of 2020 or early 2021. If it takes longer than three years, there may be adverse U.S. federal income tax consequences.

The company also said it may not be able to monetize its interest in Swap Financial Group LLC and Crown Global Insurance Group, LLC, along with other retained assets.