By Devika Patel
Knoxville, Tenn., Nov. 30 – Arch Capital Group Ltd. gave further details about its $950 million sale of fixed-rate notes (A3/A-/A) in an FWP filed Wednesday with the Securities and Exchange Commission. The deal priced in two tranches on Tuesday.
The company sold $500 million of 10-year notes at par to yield 4.011%, or 170 basis points over Treasuries. These notes have a make-whole call at Treasuries plus 30 bps until Sept. 15, 2026 and then a par call.
Arch Capital priced $450 million of 30-year notes at 205 bps over Treasuries. These notes were priced at par to yield 5.031%. These notes have a make-whole call at Treasuries plus 35 bps until June 15, 2046 and then a par call.
The notes priced on the tight side of guidance.
Credit Suisse Securities (USA) LLC, Barclays, J.P. Morgan Securities LLC, Lloyds Securities Inc., BofA Merrill Lynch, U.S. Bancorp Investments Inc., Wells Fargo Securities LLC and BMO Capital Markets Corp. were the bookrunners.
The notes were issued through Arch Capital Finance LLC and are guaranteed by parent company Arch Capital Group.
The Hamilton, Bermuda-based reinsurance company will use the proceeds for the company’s planned acquisition of United Guaranty Corp. and AIG United Guaranty (Asia) Ltd. and for anticipated growth in its mortgage and other businesses.
| Issuer: | Arch Capital Finance LLC
|
| Guarantor: | Arch Capital Group Ltd.
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| Amount: | $950 million
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| Description: | Senior notes
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, Barclays, J.P. Morgan Securities LLC, Lloyds Securities Inc., BofA Merrill Lynch, U.S. Bancorp Investments Inc., Wells Fargo Securities LLC, BMO Capital Markets Corp.
|
| Trade date: | Nov. 29
|
| Settlement date: | Dec. 8
|
| Ratings: | Moody’s: A3
|
| S&P: A-
|
| Fitch: A
|
| Distribution: | SEC registered
|
|
|
| 10-year notes
|
| Amount: | $500 million
|
| Maturity: | Dec. 15, 2026
|
| Coupon: | 4.011%
|
| Price: | Par
|
| Yield: | 4.011%
|
| Spread: | Treasuries plus 170 bps
|
| Price guidance: | Treasuries plus 175 bps area, plus or minus 5 bps
|
| Call feature: | Make-whole call at Treasuries plus 30 bps until Sept. 15, 2026 and then a par call
|
|
|
| 30-year notes
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| Amount: | $450 million
|
| Maturity: | Dec. 15, 2046
|
| Coupon: | 5.031%
|
| Price: | Par
|
| Yield: | 5.031%
|
| Spread: | Treasuries plus 205 bps
|
| Price guidance: | Treasuries plus 210 bps area, plus or minus 5 bps
|
| Call feature: | Make-whole call at Treasuries plus 35 bps until June 15, 2046 and then a par call
|
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