Amlin raises Tier Two debt
20 April 2006
Amlin plc ("Amlin"), the leading Lloyd's insurer, announces that
it has conditionally agreed to raise £230 million of long
term subordinated debt, through the issue of Fixed/Floating Rate
Subordinated Notes due 2026 ("the Issue"). The Issue qualifies as
Lower Tier Two regulatory capital. Amlin will use the proceeds to
fully refinance existing Letters of Credit and partially refinance
term loans.
The Issue is callable on 19 December 2016 and bears an initial
interest at the rate of 6.5% per annum, payable annually in arrear,
representing a spread of 200 basis points over the semi-annual
yield of the benchmark gilt. Following the call date the interest
rate resets at 266 basis points (incorporating a step up of 100
basis points) above the London interbank offered rate ("LIBOR"),
payable quarterly in arrear. The Issue has been assigned a rating
of bbb by A.M. Best and is expected to be assigned a rating of BBB-
by Standard & Poors and Baa3 by Moody's. The Issue is to be
listed on the London Stock Exchange.
Commenting on the Issue, Richard Hextall, Group Finance Director
said, "Amlin is delighted to have raised a further £230
million of subordinated debt to refinance facilities put in place
to fund our recent expansion in Bermuda. The Issue was heavily
oversubscribed and we are pleased with the positive response we
have received from investors."
"The Issue, together with the expected repayment of the £150
million Bridge Loan in June 2006, substantially lengthens the
maturity profile of our debt financing and strengthens our balance
sheet."
Barclays Capital and JP Morgan Cazenove acted as Joint Lead
Managers on the Issue. Completion of the Issue, which is subject to
certain conditions, is expected to occur on 25 April
2006.
