AXA prices bond offering for US life IPO ahead of XL acquisition
French insurer AXA has priced its offering of $750 million of bonds mandatorily exchangeable for a number of shares of common stock of its US subsidiary AXA Equitable Holdings (AEH).
The bonds will bear interest at a fixed rate of 7.25 percent per annum, payable semi-annually.
At maturity on May 15, 2021, the bonds will be exchanged into a minimum of 31,914,894 shares if the AEH share price is greater than or equal to $23.50 per share, and a maximum of 37,500,000 shares if the AEH share price does not exceed the initial public offering (IPO) price.
AXA wants to use the proceeds of the IPO of its US subsidiary (Life & Savings and Alliance Bernstein) to help financing the acquisition of Bermuda-based re/insurer XL Group for $15.3 billion.
AXA has already received $3.2 billion following the completion of a reorganisation transactions ahead of the planned IPO of its US operations.
The restructuring deal included the repayment of all internal loans provided by AXA Group and the purchase of Alliance Bernstein units previously owned by AXA and its affiliates.
Earlier in March, rating agency Fitch had threatened to downgrade AXA following the plan to acquire XL Group due to financing risks related to the planned IPO of its US subsidiary.
AXA said it expects to finance the cash consideration via €3.5 billion available cash resources, €6 billion from the IPO of AXA's US operations planned in the second quarter of 2018, and related pre-IPO transactions and €3 billion via issuance of subordinated debt.
The target completion period for the acquisition is the second half of 2018, subject to regulatory approvals and approval by XL shareholders.
Make sure you are GDPR compliant and confirm your email address to keep getting our daily emails
More of today's news
Third Point Re CEO promises improvement after Q1 loss
London cab drivers lose cover after Alpha bankruptcy
Beazley Q1 premium up 10% as pricing improves
Former Anbang chairman sentenced to 18 years in jail
Prudential signs £900m reinsurance deal with PIC
Aon picks technology leader as CEO of Aon Carrier Link
Already registered?
Login to your account
If you don't have a login or your access has expired, you will need to purchase a subscription to gain access to this article, including all our online content.
For more information on individual annual subscriptions for full paid access and corporate subscription options please contact us.
To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.
For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk
Editor's picks
Editor's picks
More articles
Copyright © intelligentinsurer.com 2024 | Headless Content Management with Blaze