By William Gullotti and Cristal Cody
Buffalo, N.Y., March 15 – Brown & Brown Inc. priced $600 million 4.2% senior notes due 2032 and $600 million 4.95% senior notes due 2052 (Baa3/BBB-) on Monday, according to an FWP filed with the Securities and Exchange Commission and additional details from a market source.
The 2032 notes priced at 99.644 to yield 4.244%, or Treasuries plus 210 basis points. Price talk was in the 230 bps area over Treasuries.
The series has a make-whole call until Dec. 17, 2031 at the greater of par and the sum of the remaining schedules of principal and interest discounted at Treasuries plus 35 bps followed by a par call. The 2032 notes are also subject to a special mandatory redemption at 101 plus interest if the associated acquisition of Global Risk Partners Ltd. is not consummated by Dec. 31, 2022.
The 2052 notes priced at 98.631 to yield 5.039%, or Treasuries plus 255 bps, and are not subject to the special redemption condition. The spread was talked in the 280 bps area.
The series has a make-whole call until Sept. 17, 2051 at the greater of par and the sum of the remaining schedules of principal and interest discounted at Treasuries plus 40 bps followed by a par call.
J.P. Morgan Securities LLC, BofA Securities, Inc., BMO Capital Markets Corp., Truist Securities, Inc., Fifth Third Securities, Inc., PNC Capital Markets LLC, U.S. Bancorp Investments, Inc., Wells Fargo Securities, LLC and Morgan Stanley & Co. LLC are the joint bookrunning managers for the offering.
Proceeds will be used together with borrowings under the company’s revolving credit facility, cash on hand and other borrowings, to fund the cash consideration and other amounts payable under the GRP acquisition agreement.
Brown & Brown is a diversified insurance company based in Daytona Beach, Fla.
| Issuer: | Brown & Brown Inc.
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| Amount: | $1.2 billion
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| Issue: | Senior notes
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| Bookrunners: | J.P. Morgan Securities LLC, BofA Securities, Inc., BMO Capital Markets Corp., Truist Securities, Inc., Fifth Third Securities, Inc., PNC Capital Markets LLC, U.S. Bancorp Investments, Inc., Wells Fargo Securities, LLC and Morgan Stanley & Co. LLC
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| Co-manager: | Citizens Capital Markets, Inc.
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| Trustee: | U.S. Bank Trust Co., NA
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| Counsel to issuer: | Holland & Knight LLP
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| Counsel to bookrunners: | Sidley Austin LLP
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| Pricing date: | March 14
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| Settlement date: | March 17
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| Ratings: | Moody’s: Baa3
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| S&P: BBB-
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| Distribution: | SEC registered
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| 2032 notes
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| Amount: | $600 million
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| Maturity: | March 17, 2032
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| Coupon: | 4.2%
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| Price: | 99.644
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| Yield: | 4.244%
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| Spread: | Treasuries plus 210 bps
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| Call: | Make-whole call at Treasuries plus 35 bps until Dec. 17, 2031, then a par call; if the GRP acquisition is not consummated by Dec. 31, 2022, mandatory redemption at 101 plus interest
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| Price talk: | 230 bps area over Treasuries
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| Cusip: | 115236AE1
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| 2052 notes
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| Amount: | $600 million
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| Maturity: | March 17, 2052
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| Coupon: | 4.95%
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| Price: | 98.631
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| Yield: | 5.039%
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| Spread: | Treasuries plus 255 bps
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| Call: | Make-whole call at Treasuries plus 40 bps until Sept. 17, 2051, then a par call
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| Price talk: | 280 bps area over Treasuries
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| Cusip: | 115236AF8
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