27 March 2018Insurance

Assurant in $900m capital raise to seal Warranty Group deal

US-based Assurant, a provider of risk management solutions, will move closer to completing its  acquisition of The Warranty Group, a provider of protection plans, for some $2.5 billion if it succeeds in completing a $900 million senior debt sale this week.

The two companies have been negotiating since last October but the deal’s structure was changed in January this year to reflect changes in US tax legislation. The deal is worth $1.9 billion in equity value or $2.5 billion in enterprise value.

Assurant will raise the $900 million via three tranches of senior notes each worth $300 million with maturities of 2021, 2023 and 2028 respectively. It will also issue $400 million of fixed-to-floating rate subordinated notes due in 2048.

The company said it intends to use the net proceeds of this offering, together with net proceeds from the March 12, 2018 issuance of 2,875,000 shares of its Mandatory Convertible Preferred Stock, available cash on hand and common stock consideration, to finance the TWG Acquisition, refinance its 2018 Notes and to pay related fees and expenses.

If the TWG Acquisition has not closed on or prior to December 17, 2018, it is required to redeem the 2021 Senior Notes, 2023 Senior Notes and the Fixed-to-Floating Rate Subordinated Notes, in whole but not in part, at a redemption price equal to 101 percent of the aggregate principal amount of such notes, plus accrued and unpaid interest on such notes to the date of redemption.

It is not required to redeem the 2028 Senior Notes and proceeds from the 2028 Senior Notes will be available for general corporate use.

Join us at Intelligent Automation in Insurance - London 2018. Spring Special:  Book before March 31st and save £200.

More of today's news

Greenberg fails in latest attempt to sue federal government over AIG bailout

Ed boosts risk solutions unit with Lloyd & Partners hire

Tokio Marine Kiln launches new cyber package alongside XCyber

LMA elects Beazley exec to aviation committee

IMA appoints new chief operations officer

Don't miss our insurtech email newsletter - sign up today


More on this story

Insurance
15 April 2021   Service relieves entrepreneurs from back office concerns allowing them to focus on customers.
Insurance
18 December 2020   The acquisition provides Assurant with additional scale and expands its product offerings.
Insurance
13 August 2020   The executive will be responsible for asset management functions, portfolio strategy, investment risk analytics and compliance.

More on this story

Insurance
15 April 2021   Service relieves entrepreneurs from back office concerns allowing them to focus on customers.
Insurance
18 December 2020   The acquisition provides Assurant with additional scale and expands its product offerings.
Insurance
13 August 2020   The executive will be responsible for asset management functions, portfolio strategy, investment risk analytics and compliance.

Intelligent Insurer
Newton Media Ltd
Kingfisher House
21-23 Elmfield Road
BR1 1LT
United Kingdom