Tower Limited (NZX: TWR) Tower and Earthquake Commission Reach Settlement

Tuesday 24th November 2020

Tower Limited (NZX/ASX: TWR) today announced that it has entered into a settlement agreement with the Earthquake Commission (EQC) regarding an outstanding receivable resulting from the Canterbury Earthquakes.

Under the settlement agreement Tower will receive $42.1m after disbursement to reinsurers and costs. The write off of the residual amount will result in an impact of approximately $9.5m on Tower’s FY20 reported net profit.

Tower Chairman, Michael Stiassny, said that the settlement amounted to 76% of the gross carrying value listed in Tower’s accounts, a good outcome that means the company can now turn its full focus to the future.

“The Canterbury Earthquakes remain a significant event in New Zealand’s history and will have a lasting impact on the community,” said Stiassny.

“For Tower, this legacy resulted in distractions that have been progressively removed over the years and it is important we provide the management team with clear air to move the business forward and accelerate.

“The Board determined that reaching this settlement agreement dealt with any remaining unpredictability and gave certainty to our shareholders, who will be pleased to see this risk removed from our business.

“We now have a very strong capital position and will provide a further update in relation to dividend payments with our 2020 financial year results announcement tomorrow.”

See the links below for more details:

Tower and EQC Reach Settlement

Source: Tower Limited

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