Fitch rates new Intact debt A-

Fitch Ratings said it assigned an A- rating to Intact Financial Corp.'s C$425million 10-year senior unsecured debt issue.

All of Intact's other ratings are unaffected by this issuance.

The rating for the unsecured debt is equivalent to the rating on Intact's existing debt.

The proceeds will be used to fund the purchase of OneBeacon Insurance Group Ltd., which is anticipated to close in the fourth quarter of 2017, Fitch said.

If the acquisition does not close, the proceeds will be used to redeem this issuance at 101% of outstanding aggregate principal, plus any accrued and unpaid interest, the agency said.

Fitch noted that not all of the funding for the OneBeacon transaction has occurred and anticipates the company will access the capital markets for additional financing before the deal closes.

Intact's financial leverage as of March 31 was about 19% and pro forma for the acquisition the ratio increases to about 25%, the agency noted.

But Fitch said it believes the company's management will actively target financial leverage to return to pre-transaction levels within 24 months.

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