Assurant Inc. commenced a public offering of 2.5 million shares of its series D mandatory convertible preferred stock, subject to market conditions.
The company expects to grant the underwriters a 30-day option to purchase up to an additional 375,000 shares, solely to cover overallotments.
Assurant intends to use the net proceeds from the offering together with proceeds from the issuance of new debt, cash on hand and common stock consideration to fund its planned acquisition of TWG Holdings Ltd., refinance its existing 2.50% senior notes due 2018 and pay related fees and expenses.
Unless converted earlier, each preferred share will automatically convert into a variable number of shares of Assurant's common stock on or around March 15, 2021.
The offering is not contingent upon the consummation of the TWG Holdings acquisition, although Assurant has the option of redeeming the stock under certain circumstances if the acquisition is not consummated.
If the acquisition is not consummated and if Assurant does not exercise its option to redeem the preferred stock, the offering's net proceeds would be available for the refinancing of the 2018 senior notes and general corporate purposes.
Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC and Wells Fargo Securities LLC are acting as joint book-running managers for the offering.
