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Fitch: Old Mutual notes BB+
Fitch Ratings said it assigned a BB+ rating to Old Mutual plc’s £450 million issue of subordinated debt securities.
The notes are rated three notches below Old Mutual’s issuer default rating of BBB+ to reflect their subordination and moderate risk of non-performance, Fitch said.
The securities have a 10-year bullet maturity and pay a 7 7/8% fixed-coupon semi-annually.
Fixed-charge coverage is expected to remain solid given Old Mutual’s strong track record of earnings generation, the agency said.
The proceeds will be used to replace the €373 million tier 2 debt, which has recently been called, Fitch said.
The proceeds also are expected to be used to pay maturing senior debt in 2016, the agency added.
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