egolinews.com

QBE Insurance Group Limited (QBE) announced the launch of an issue to institutional investors of 20-year zero coupon Senior Convertible Securities raising US$850 million. The company said the funds would be used to repay GBP 310 million from a previous convertible securities issue in 2007 (LYONs IV), with the balance of funds to be used for general corporate purposes.

QBE said the repayment means that it would not be issuing any shares under LYONs IV.

CEO, Frank O’Halloran, said the refinancing has provided the opportunity to substantially reduce the borrowing costs and to raise additional low cost funds to support QBE’s ongoing growth.

”The annual average cost of our total borrowings is expected to reduce to around 5.7% compared with 6.8% at 31 December 2009,” Mr O’Halloran said.

As at 1423 AEST, QBE shares were down 18c to $21.02.

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