Moody’s rates Sampo notes Baa1

Moody's Investors Service said it assigned a Baa1(hyb) rating to the €1 billion of subordinated notes to be sold by Sampo plc and intended to qualify as tier 2 capital.

“The Baa1(hyb) rating is consistent with Moody's standard notching practices for debt issued by insurance holding companies and reflects (i) the subordination of the bond (ii) the optional and mandatory (based on breach of regulatory capital requirements or regulatory intervention) coupon skip mechanisms and (iii) the cumulative nature of deferred coupons, in case of deferral,” Moody’s said in a press release.

The bond is a dated subordinated debt and it allows Sampo to defer interest payments on any interest payment date if no dividend on any class of share was declared or paid during the previous six-month period, the agency said.

Sampo recently announced it plans to acquire a 70% majority stake in Hastings Group Holdings plc, which is listed on the London Stock Exchange, via a tender in the open market for about €1.3 billion. “The issuance of €1 billion subordinated debt to partially fund the acquisition is in line with the funding plan as set out by Sampo previously,” Moody’s said.

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