Assurant Inc.’s (AIZ) recently announced $750 million unsecured senior subordinated notes have been conferred a debt rating of “bbb” by A.M. Best Co.
These notes will be issued in three parts – $250 million 2.96% senior unsecured notes due March 2018, the $250 million 4.26% senior unsecured notes due March 2023 and the $250 million 5.83% senior unsecured notes due March 2043
Assurant has also announced the pricing of a public offering of $350 million in aggregate principal amount of its 2.50% senior notes due 2018 and $350 million in aggregate principal amount of 4.00% senior notes due 2023.
The funds gathered from the notes issue will be used primarily for general corporate purposes which includes redemption of $500 million of 5.63% senior notes due February 2014.
The issue will be managed by BofA Merrill Lynch a unit of Bank of America Corp. (BAC) and J.P. Morgan Securities LLC of JPMorgan Chase & Co. (JPM) who will be acting as joint book-running managers.
All the ratings carry a stable outlook. A stable outlook reflects that Assurant, is experiencing stable financial and market trends, and that therefore a rating change in the near term is unlikely.
The financial position of Assurant remains strong with $4.4 billion of equity capital as of Dec 31, 2012, which remained unchanged on a sequential basis. The company maintains a low leverage ratio of 18.3%, almost unchanged from 18.4% as of Dec 31, 2011.
Assurant currently carries a Zacks Rank #2 (Buy). Other insurers such as Assured Guaranty Ltd. (AGO) with a Zacks Rank #2 (Buy) is worth considering.Read the Full Research Report on JPM
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