By Stephanie N. Rotondo
Portland, Ore., April 3 - Hartford Financial Services Group, Inc. priced $600 million of 7.875% fixed-to-floating-rate $25-par junior subordinated debentures due April 15, 2042, the company said in an FWP filing with the Securities and Exchange Commission on Tuesday.
When the deal was first announced Monday, the company was expected to issue $500 million of the notes (Ba1/BB+/expected BB).
The interest rate will be fixed until April 15, 2022. It will then be Libor plus 559.6 basis points. The floating rate will be reset quarterly.
Interest will be payable on a quarterly basis on the 15th of January, April, July and October.
Interest payments can be deferred for up to 10 years without an event of default.
Before April 15, 2022, the notes have a make-whole call option within 90 days of a tax event or rating agency event. Beginning April 15, 2022, they are callable at par at any time.
Hartford will apply to list the notes on the New York Stock Exchange. Settlement is expected April 5.
Citigroup Global Markets Inc. and Goldman Sachs & Co. are the joint structuring advisers and bookrunning managers. Bank of America Merrill Lynch, Barclays Capital Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC are also acting as joint bookrunners. Credit Suisse Securities (USA) LLC, UBS Securities LLC, U.S. Bancorp Investments, Inc. and Wells Fargo Securities, LLC are senior co-managers. BB&T Capital Markets, BNY Mellon Capital Markets, LLC, Lloyds Securities Inc., PNC Capital Markets LLC, RBS Securities Inc., SMBC Nikko Capital Markets Ltd. and Williams Capital Group, LP are junior co-managers.
Proceeds from the sale will be used toward a planned repurchase of 10% fixed-to-floating-rate junior subordinated debentures due 2068.
Hartford Financial is an insurance and financial services company based in Hartford, Conn.
| Issuer: | Hartford Financial Services Group, Inc.
|
| Securities: | Fixed-to-floating-rate junior subordinated debentures
|
| Amount: | $600 million
|
| Maturity: | April 15, 2042
|
| Coupon: | Fixed at 7.875% until April 15, 2022; then Libor plus 559.6 bps, reset quarterly
|
| Price: | $25 per note
|
| Call option: | Make whole at Treasuries plus 70 bps within 90 days of a tax event or rating agency event prior to April 15, 2022; at par any time on or after April 15, 2022
|
| Joint structuring advisers: | Citigroup Global Markets Inc. and Goldman Sachs & Co.
|
| Joint bookrunners: | Citigroup Global Markets Inc., Goldman Sachs & Co., Bank of America Merrill Lynch, Barclays Capital Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC
|
| Senior co-managers: | Credit Suisse Securities (USA) LLC, UBS Securities LLC, U.S. Bancorp Investments, Inc. and Wells Fargo Securities, LLC
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| Junior co-managers: | BB&T Capital Markets, BNY Mellon Capital Markets, LLC, Lloyds Securities Inc., PNC Capital Markets LLC, RBS Securities Inc., SMBC Nikko Capital Markets Ltd. and Williams Capital Group, LP
|
| Pricing date: | April 2
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| Settlement date: | April 5
|
| Ratings: | Moody's: Ba1
|
| Standard & Poor's: BB+
|
| Fitch: BB (expected)
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| Cusip: | 416518504
|
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