Lloyd’s of London has overcome one challenge to its rescue plan in the US. It is awaiting the outcome of a second legal hurdle in Virginia, where 93 names are attempting to block its proposals in the US.
Names have a week to accept the £3.2bn “reconstruction & renewal” rescue package. Under the plan, pre-1992 losses will be reinsured into a new company, Equitas.
The Amercian Names claim that Lloyd’s sold them a security and should therefore be subject to US securities laws. Lloyd’s claims membership is covered by contract law and therefore Names have agreed to be subject to English law.
Lloyd’s claims the rescue package is essential to its future. The company is supported by the DTI in its US actions.
- The Telegraph 21/08/96 page 25
- Financial Times 21/08/96 page 1
