Alabama-based Infinity Property and Casualty Corporation, a provider of personal automobile insurance with an emphasis on non-standard auto insurance, has closed the previously announced offering of $200 million Senior Notes due 2014. The Senior Notes will pay a coupon of 5.5 percent and carry an effective rate of 5.55 percent. Of the $198 million in net proceeds, $193 million will be used to prepay the company’s seven year amortizing secured term loan and the remainder for general corporate purposes.
“At the outset of our Initial Public Offering, our goal was to secure long-term financing that would support our future growth.” stated Jim Gober, Infinity’s president, CEO & chairman. “We are pleased that we were able to accomplish this during the first quarter and upon such favorable terms.”
In connection with the prepayment of the term loan, Infinity will write off approximately $3.3 million, pre-tax, of unamortized debt issue costs. In addition, Infinity will incur a pre-tax loss of approximately $279,000 related to unwinding the interest rate swap required by the term loan.
As a result of closing the transaction, Infinity is revising its 2004 earnings guidance. Operating earnings are expected to be in the range of $2.65 – $2.85.
Topics Property Property Casualty Casualty
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