Aspen Insurance talks $500 million five-year PIK toggle notes with 7¾% cash coupon; pricing Friday

By Paul A. Harris

Portland, Ore., Oct. 23 – Aspen Insurance set price talk in its $500 million offering of Highlands Holdings Bond Issuer, Ltd. and Highlands Holdings Bond Co-Issuer, Inc. five-year senior secured PIK toggle notes on Friday morning, according to a syndicate source.

The deal is talked to come with a cash coupon in the 7¾% area and a 75 basis points step-up for PIK coupon payments.

The Rule 144A and Regulation S for life deal is set to price later on Friday.

Jefferies LLC and Goldman Sachs & Co. LLC are the joint bookrunners. Apollo is the co-manager.

The notes become callable after two years at par plus 50% of the coupon.

The Hamilton, Bermuda-based property and casualty insurance and reinsurance company plans to use the proceeds to provide additional capital to its operating group, to fund a distribution and to pay for the initial period’s interest expense.

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