Beazley to Raise $383 Million

October 5, 2006

The London-based Beazley Group plc announced that it has conditionally agreed to raise £150 million ($283 million) of Lower Tier Two long term subordinated debt, through the issue of Fixed / Floating Rate Subordinated Notes due 2026.

Beazley said the “proceeds of the Issue will be used to replace an existing short term facility and to support opportunities to grow the business as they arise.

“The Issue is callable on 17 October 2016 and bears an initial interest at the rate of 7.25 per cent, payable annually in arrear, representing a spread of 265 basis points over the benchmark gilt. Following the call date the interest rate resets at 328 basis points above the London interbank offer rate (“LIBOR”), payable quarterly in arrear. The Issue is expected to be assigned a rating of BBB- by Standard & Poor’s and to be listed on the London Stock Exchange.”

Group Finance Director Andrew Horton commented: “We are enthusiastic about our debut in the debt markets and are delighted that it was so heavily over subscribed. The £150 million of subordinated debt, which this Issue will raise, will further strengthen our balance sheet.”

Chief Executive Andrew Beazley added: “The rating Beazley received from Standard & Poor’s and investor demand for the issue are a positive endorsement of the direction the business is taking. The insurance industry is going through an exciting phase and a well-structured balance sheet will support future development.’

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