Aspen Insurance $200 million convertible perferreds talked to yield 5.125%-5.625%, up 22%-27%

By Rebecca Melvin

Princeton, N.J., Dec. 6 - Aspen Insurance Holding Ltd. plans to price $200 million of convertibles, which were talked to yield 5.125% to 5.625% for the dividend, with an initial conversion premium of 22% to 27%, according to a syndicate source.

The perpetual Preferred Income Equity Replacement Securities, or perpetual PIERS, are being sold via bookrunner Lehman Brothers, and include an option to purchase an additional $30 million to cover over allotments.

The convertibles will be convertible at the option of the holder into non-convertible perpetual preference shares and, under certain circumstances, ordinary shares; and convertible at the company's option into cash or ordinary shares.

Concurrently with the convertible offering, Aspen will offer about $200 million of ordinary shares, while shareholder Wellington Underwriting plc is expected to offer up to 6 million ordinary shares, representing 61% of its holdings, excluding exercisable options to purchase 3,781,120 ordinary shares.

Aspen intends to use proceeds from the sale of both offerings to make contributions to the capital and surplus of its operating subsidiaries and for general corporate purposes.

Hamilton, Bermuda-based Aspen Insurance is an insurance and reinsurance company.

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