New Issue: Fortis sells $774 million mandatory exchangeable, convertible into Assurant, at 7.75%, up 22%

Nashville, Jan. 21 - Fortis NV sold $774 million of three-year mandatory exchangeable bonds, convertible into Assurant Inc. shares, at par of 33.66 to yield 7.75% with a 22% initial conversion premium via bookrunner Morgan Stanley & Co.

The Rule 144A deal priced at the aggressive end of price talk for a yield of 7.75% to 8.25% and initial conversion premium of 18% to 22%.

Fortis essentially disposed of its stake in New York City-based Assurant with the exchangeable bonds and a concurrent offering of its remaining 27.2 million shares of common stock. In February 2004, Fortis sold about half its stake in Assurant with an initial public offering that brought it $1.8 billion. At that time, the Belgian-Dutch financial services firm had said it planned to dispose of its remaining stake in Assurant over time.

Terms of the deal are:

Issuer:	Fortis NV
Reference shares:	Assurant Inc.
Issue:	Mandatory exchangeable bonds
Bookrunner:	Morgan Stanley & Co.
Amount:	$774 million
Maturity:	Jan. 26, 2008
Coupon:	7.75%
Price:	Par, $33.66
Yield:	7.75%
Conversion premium:	22%
Conversion price:	$41.0652
Conversion ratio:	0.8197
Contingent conversion:	No
Contingent payment:	No
Dividend protection:	Yes
Takeover protection:	Yes
Call:	Non-callable
Put:	No
Price talk:	7.75-8.25%, up 18-22%
Pricing date:	Jan. 20, after market close
Settlement date:	Jan. 28
Distribution:	Rule 144A

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