CNO Financial Group Inc.
) announced an increase in the size of its offering of senior
secured notes due 2020 to $275 million from $250 million. However,
the company expects to raise only $267 million in net proceeds
after making adjustments for initial purchasers' discounts and
commissions and expected offering expenses.
Concurrently, CNO Financial revealed that it might boost the
size of its new 6-year term loan facility to $425 million from $400
million. The company also announced an interest of 6.375% per annum
on the senior notes, which will be payable on the first day of
April and October every year. These notes will mature on October 1,
2020. The offer is expected to close on September 28, 2012, subject
to closing conditions.
The senior secured notes will be guaranteed by CNO Financial's
domestic subsidiaries, in accordance with the company's new senior
secured credit agreement. However, CNO Financial will not register
the notes and guarantees under the Securities Act or any other
state securities law.
CNO Financial will use the net proceeds from the senior notes
and $425 million term loan facility, along with a $250 million
4-year term loan facility under the company's new senior secured
credit agreement, for repayment of the borrowings made under the
old senior secured credit agreement. The amount will also be used
to purchase the outstanding 9% senior secured notes due 2018, which
were tendered under a cash tender and consent solicitation
announced earlier this year, and to redeem any 9% notes not
purchased under the tender offer.
Further, the proceeds will be used for purchasing the
outstanding 7% convertible senior debentures due 2016, worth $200
million, and for payment of fees and expenses related to the new
senior notes offer. Any residual sum will be utilized to fulfill
general corporate purposes.
CNO Financial, which competes with
), currently carries a short-term Zacks #2 Rank (Buy).
AFLAC INC (AFL): Free Stock Analysis Report
CNO FINL GRP (CNO): Free Stock Analysis Report
TORCHMARK CORP (TMK): Free Stock Analysis
To read this article on Zacks.com click here.