Swiss Re talks $500 million six-year exchangeable notes to yield 2.75% to 3.25%, up 30% to 35%

By Abigail W. Adams

Portland, Me., June 6 – Swiss Re plans to price an offering of $500 million six-year exchangeable notes on Wednesday with price talk for a coupon of 2.75% to 3.25% and an initial conversion premium of 30% to 35%, according to a company news release.

Swiss Re will issue the notes to repackaging vehicle ELM BV which will issue its own six-year exchangeable notes secured by the notes issued by Swiss Re.

ELM will distribute the notes in accordance with Regulation S.

The reference share price will be the volume-weighted average price of shares over an averaging period that will run from June 7 to June 20.

The notes will be settled with new or existing Swiss Re treasury shares which are subject to a floor of 50% of the reference share price.

Swiss Re will purchase call options on Swiss Re shares from hedging counterparties who are expected to enter into transactions to hedge their positions during the averaging period for the reference share price.

The ELM notes will be listed on the Open Market of the Frankfurt Stock Exchange.

The Swiss Re Group is a Zurich, Switzerland-based reinsurance company.

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