Insurance Australia Group (IAG) has announced that it will attempt to raise A$350 million through the issuance of Convertible Preference Shares (CPS).
The shares will be quoted through the Australian Securities Exchange, with the minimum investment being A$5,000.
Dividends will be paid out every six months, with an expected return of 4 percent. IAG also plans to amend the terms of its existing Reset Preference Shares (RPS), which have a reset date of 15 June 2012, to enable Australian holders to participate in the CPS issue by reinvesting their RPS in CPS.
IAG intends to buy back the residual non-participating RPS on 15 June 2012. Holders of CPS will receive preferred, discretionary, non-cumulative, floating rate dividends.
These are scheduled to be paid semi-annually (subject to dividend payment tests) and are expected to be fully franked.