W.R. Berkley plans to sell $25-par subordinated debentures due 2056; price talk in 5.9% area

By Stephanie N. Rotondo

Seattle, Feb. 23 – W.R. Berkley Corp. is offering at least $150 million of $25-par subordinated debentures due 2056 (expected ratings: Baa3/BBB-/BBB-), according to a prospectus filed with the Securities and Exchange Commission on Tuesday.

Price talk is in the 5.9% area, a market source reported.

BofA Merrill Lynch, J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are running the books.

Interest will be payable on a quarterly basis. The company has the right to defer payments for up to five consecutive years, during which time the interest is compounded quarterly.

The securities become redeemable in whole or in part in 2021 at par plus accrued interest. If the issue is not redeemed in whole, $25 million must remain outstanding.

Additionally, the company can redeem the notes prior to 2021 within 90 days of a tax or rating agency event. Upon a tax event, the redemption price will be par plus accrued interest, while in the case of a rating agency event, holders will receive the greater of the notes’ principal amount or a make-whole amount.

The paper will be listed on the New York Stock Exchange under the ticker symbol “WRBPC.”

Proceeds will be used for general corporate purposes.

W.R. Berkley is a Greenwich, Conn.-based insurance holding company.

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