American Safety Holdings Corp., a wholly-owned subsidiary of American Safety Insurance Holdings, Ltd., has completed a $5 million private placement of trust preferred securities.
The securities have a floating interest rate equal to the three-month LIBOR plus 3.95 percent and mature in 30 years. The securities can be redeemed by American Safety Insurance commencing in five years. Payments under the trust preferred securities are guaranteed by American Safety Insurance Holdings, Ltd.
American Safety Insurance, through a subsidiary statutory trust, along with other insurance and insurance holding company participants, issued trust preferred securities to an investment pool for which Merrill Lynch International and others acted as placement agents.
American Safety Insurance will use the $4.85 million of net proceeds of the offering to support the growth of its insurance business, to repay short-term debt and for general corporate purposes.
“We are pleased to increase our capital base with the proceeds of the offering which we believe will position American Safety Insurance for continued success in implementing our insurance growth strategies and allow us to take advantage of favorable current hard market conditions in our core business lines,” said Stephen Crim, president and CEO.
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