Australia's QBE Insurance issues 550 mln usd in perpetual preferred shares |
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Published
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Thu, 26 Apr 2007 01:23
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SYDNEY (XFN-ASIA) - QBE Insurance Group Ltd said it has raised 550 mln usd through the issue of non-cumulative, perpetual preferred securities to institutional investors.Australia's largest insurer by premium income said issuance of the securities is expected to be completed on May 2.The company said the securities are essentially similar to those issued on July 12 last year, when it raised 300 mln stg through a private placement with institutional investors.The new securities carry a fixed rate of 6.797 pct per annum until June 1, 2017, when it changes to a floating rate of LIBOR for three-month US dollar deposits plus a spread of 2.625 pct.They are redeemable at the option of QBE, with the prior written approval of the Australian Prudential Regulation Authority if required, at maturity or any distribution payment date after that or earlier, on occurrence of certain regulatory, tax and acquisition events.The securities will be exchangeable into new QBE preference shares in certain circumstances, such as a payment default and on QBE's election.QBE chief executive Frank O'Halloran said the latest debt issuance will assist with previously announced funding for proposed US acquisitions.In 2006, QBE bought US insurers Praetorian Financial Group and Winterthur US for a combined 2.0 bln usd, and this year it bought Mexico's Seguros Cumbre.Earlier this month, QBE said it expects 2007 net profit to be at least 20 pct higher than last year's 1.48 bln aud and sees diluted earnings per share growth of at least 15 pct year-on-year, boosted by the acquisitions in the US.(1 usd = 1.20 aud)paul.daniel@xfn.com
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