Fidelity & Guaranty unit gets $295 million reserve facility via Nomura

By Susanna Moon

Chicago, Oct. 10 - Harbinger Group Inc. announced a $295 million reserve credit facility between Nomura Bank International and its primary insurance company, Fidelity & Guaranty Life.

The facility replaces a seller-provided facility under the stock purchase agreement with Old Mutual plc for the acquisition of Fidelity & Guaranty.

Under the terms of the reserve credit facility agreement, Nomura will provide Raven Re, a wholly owned subsidiary of Fidelity & Guaranty, with a five-year facility at a lower financing cost to recapture business that was ceded to Old Mutual Reassurance (Ireland) Ltd., according to a press release by Harbinger.

Under the terms of the stock purchase agreement with Old Mutual, Harbinger was required to recapture this ceded business by Dec. 31, 2015.

"This marks an important milestone for [Fidelity & Guaranty], as the company has eliminated the last remaining credit support by its former owner, more than three years ahead of our obligation and at a lower financing cost," Phil Gass, Harbinger's vice president of investments, said in the release.

Harbinger is a New York-based holding group for subsidiaries Spectrum Brands Holdings, Inc., a branded consumer products company, and Fidelity & Guaranty Life Insurance Co., a life insurance and annuity company.

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