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QBE tenders for convertibles due 2030; remaining notes will be called
By Susanna Moon
Chicago, Nov. 4 - QBE Insurance Group Ltd. said it began a tender offer and is issuing a redemption notice for the senior convertible securities due 2030 issued by QBE Funding Trust V in May 2010.
The tender purchase price will be $686.4645 per convertible note, which is equal to the issue price plus extraordinary cash dividend pass-through and the original issue discount accrued to the settlement date of Dec. 23, according to a company press release.
The company said it will redeem for cash on Dec. 24 any notes not tendered in the offer at $686.5099 per note, which is equal to its issue price plus any extraordinary cash dividend pass-through and the original issue discount accrued to the redemption date.
The tender offer will end on Nov. 20.
In the tender offer, holders may elect to receive the tender purchase price as cash only or cash and/or QBE ordinary shares.
The option of cash and/or shares is subject to a cap of no more than about A$240 million of QBE ordinary shares being issued in the tender process.
The number of QBE shares to be issued for the tender price will be set using the purchase price divided by a U.S. dollar conversion of the price per QBE ordinary share, in turn determined from a volume-weighted average price of QBE ordinary shares over a period prior to Dec. 18.
"The tender offer is the next step in our ongoing capital and debt management program and will assist in achieving our target debt to equity ratio of around 40% or lower by the end of 2013," John Neal, QBE's chief executive officer, said in the press release.
The general insurance company is based in Sydney.
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