Arch Capital Group Ltd. Announces $450 Million Public Offering of Depositary Shares Representing Series E Preferred Shares

Insurance Weekly News

By a News Reporter-Staff News Editor at Insurance Weekly News -- Arch Capital Group Ltd. [NASDAQ:ACGL] announced that it has priced an underwritten public offering of 18,000,000 Depositary Shares, each of which represents a 1/1,000th interest in a 5.25% Non-Cumulative Preferred Share, Series E, of ACGL. The public offering price is $25 per Depositary Share for an aggregate public offering price of $450 million. The underwriters have been granted a 30-day option to purchase up to an additional 2,700,000 Depositary Shares. The Company intends to use the net proceeds of this offering to fund a portion of the cash consideration for its acquisition of United Guaranty Corporation and AIG United Guaranty Insurance (Asia) Limited from their current owner, American International Group, Inc. (UGC Acquisition), to pay related costs and expenses and for general corporate purposes. The closing of this offering is not contingent on the closing of the UGC Acquisition. The offering is expected to close on September 29, 2016, subject to customary closing conditions.

On or after September 29, 2021, the Company may redeem all or a portion of the Series E Preferred Shares at a redemption price equal to $25,000 per Series E Preferred Share (equivalent to $25 per Depositary Share), plus declared and unpaid dividends, if any, to, but excluding, the date of redemption. The Depositary Shares have been approved for listing on the NASDAQ Stock Market LLC under the symbol "ACGLP."

The offering is being led by Credit Suisse Securities (USA) LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Wells Fargo Securities, LLC, J.P. Morgan Securities LLC, and RBC Capital Markets, LLC as joint book-running managers.

Arch Capital Group Ltd., a Bermuda-based company with approximately $7.60 billion in capital at June 30, 2016, provides insurance and reinsurance on a worldwide basis through its wholly owned subsidiaries.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which the offer, solicitation or sale is not permitted. The offering is being made pursuant to the Company's effective shelf registration statement previously filed with the Securities and Exchange Commission. This offering may be made only by means of a prospectus, including a preliminary prospectus supplement, forming a part of the effective registration statement.