Earlier this week,
) announced the pricing of long-term fixed rate notes worth $750
million in order to redeem the prior debt and gain capital
Accordingly, this tranche of 10-year fixed rate senior notes
worth $700 million is issued at a price of $100.00. Moreover,
both the coupon rate and expected yield for the notes are pegged
Further, Aflac has appointed Goldman Sachs & Co. of
Goldman Sachs Group Inc.
), Mizuho Securities USA Inc. of
Mizuho Financial Group Inc.
), Morgan Stanley & Co. LLC of
), and J.P. Morgan Securities LLC of
JP Morgan Chase & Co.
) as its joint book-running managers.
Meanwhile, management plans to use the proceeds from the sale
of these notes to prepay Aflac's 1.47% Samurai notes worth $347
million (28.7 billion yen) that is due in Jul 2014 along with its
interest of 5.5 billion yen.
Additionally, Aflac plans to redeem long-term notes worth $300
million, bearing an interest of 3.45%, which are scheduled to
mature in Aug 2015. The remaining amount of the proceeds is
expected to inject ample liquidity over the next two years by
utilizing funds for general corporate and capital purposes.
On the other hand, ratings agency A.M. Best has cast an "a-"
debt rating on the issued notes with a stable outlook. Last
month, the ratings agency had also reiterated its credit and
insurance strength ratings on Aflac. A.M. Best remains confident
about the company's core operating strength.
Along with a strong brand name, Aflac enjoys a solid business
model and healthy risk-based capitalization with reduced asset
impairments. Healthy financial leverage and interest-coverage
ratios also reflect a minimal risk exposure and strong solvency
While Aflac, Goldman and Morgan Stanley carry a Zacks Rank #3
(Hold), JP Morgan and Mizuho Financial are pegged at Zacks rank
AFLAC INC (AFL): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis
JPMORGAN CHASE (JPM): Free Stock Analysis
MIZUHO FINL-ADR (MFG): Free Stock Analysis
MORGAN STANLEY (MS): Free Stock Analysis
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