Swiss Re AG launched an offering of $500 million of 3.25% senior exchangeable notes to be redeemed on or around June 13, 2024.
Interest is payable semiannually. The notes may be redeemed early in cash in limited circumstances.
Noteholders have a put option in the event of a change of control, delisting or a nationalization event. The notes may be exchanged at the option of noteholders for shares at the exchange price that will be set at a premium of 30% to the reference share price, which is the initial volume-weighted average price of such shares between June 7 and June 20.
Swiss Re is purchasing matching call options on its shares with a portion of the proceeds. Consequently, no new shares will be issued upon a noteholder-initiated exchange.
Swiss Re can stock settle the notes with existing treasury shares or newly issued shares to manage any decline in its group solvency ratios and/or rating agency capital metrics. The number of shares to be delivered to noteholders will depend on the market value of the ELM notes and the prevailing share price at the time. However, if the Swiss Re Group, or if applicable, Swiss Re's solo solvency ratio, were to fall below 160% of its minimum regulatory capital requirement, the prevailing share price is subject to a floor equal to 50% of the reference share price.
The reference share price, the initial exchange price and the initial share price floor will be announced June 20.
