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Allstate to retire $3 billion of bonds with new issue proceeds, cash
By Susanna Moon
Chicago, May 22 - Allstate Corp. said it plans to retire about $3 billion of outstanding senior and subordinated bonds by using a combination of preferred stock, debt and cash.
The capital plan will consist of retiring debt primarily through new issues, according to Steve Shebik, Allstate's chief financial officer, in a company press release.
The company will repay or prefund $1.2 billion of debt coming due in 2013 and 2014, he said.
In addition, Allstate expects to purchase through tender offers some of its $4.3 billion of outstanding debt at a premium, Shebik noted in the release.
Funding will come from the issue of perpetual preferred stock, subordinated hybrid debt, senior debt and cash.
"Today's announcement is another example of Allstate's proactive and disciplined capital management," Thomas J. Wilson, the company's chairman, president and chief executive officer, said in the press release.
"The net result will be more equity in the capital structure, lower capital cost and a longer maturity profile, with no meaningful impact on ongoing earnings. These actions further enhance our strategic and capital flexibility and take advantage of the current unprecedented low cost of these capital sources."
The issuer is a Northbrook, Ill.-based insurance company.
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