AmTrust Announces Pricing of Private Offering of $175.0 Million Principal Amount of Convertible Senior Notes
December 16 2011 - 8:22AM
AmTrust Financial Services, Inc. (Nasdaq:AFSI) ("AmTrust") today
announced that it has agreed to sell $175.0 million aggregate
principal amount of its 5.50% convertible senior notes due 2021
(the "convertible notes") to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended
(the "Securities Act"). AmTrust has granted the initial purchasers
a 30-day option to purchase up to an additional $25.0 million
aggregate principal amount of its convertible notes. The offering
is expected to close on December 21, 2011, subject to customary
closing conditions.
The convertible notes will be the senior, unsecured obligations
of AmTrust and will bear interest at a rate of 5.50% per annum,
payable semi-annually in arrears on June 15 and December 15 of each
year, beginning on June 15, 2012. The convertible notes will mature
on December 15, 2021. Holders of the convertible notes will have
the right to require AmTrust to purchase their convertible notes
for cash, in whole or in part, in the event of a fundamental change
at 100% of the principal amount of the convertible notes to be
purchased, plus any accrued and unpaid interest.
Prior to September 15, 2021, the convertible notes will be
convertible only upon satisfaction of certain conditions, and
thereafter, at any time prior to the close of business on the
second scheduled trading day immediately preceding the maturity
date. The conversion rate will initially equal 31.4218 shares
of AmTrust common stock per $1,000 principal amount of convertible
notes, which corresponds to an initial conversion price of
approximately $31.83 per share of AmTrust common stock,
representing a conversion premium of 25.0% over $25.46, which was
the last reported sale price of AmTrust common stock on December
15, 2011. The conversion rate will be subject to adjustment upon
the occurrence of certain events. Upon conversion of the
convertible notes, AmTrust will, at its election, pay or deliver,
as the case may be, cash, shares of AmTrust common stock, or a
combination of cash and shares of AmTrust common stock.
AmTrust estimates that the net proceeds it will receive from the
offering will be approximately $169.27 million, after deducting the
initial purchasers' discounts and commissions and estimated
offering expenses payable by AmTrust. AmTrust intends to use the
net proceeds from the offering for general corporate purposes,
which may include working capital, repayment of debt, capital
expenditures and/or strategic acquisitions.
The convertible notes and the shares of AmTrust's common stock
issuable upon conversion of the convertible notes have not been
registered under the Securities Act or the securities laws of any
state or other jurisdiction and, unless so registered, may not be
offered or sold in the United States except pursuant to an
exemption from the registration requirements of the Securities Act
and applicable securities laws of any relevant state or
jurisdiction.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities nor shall there be
any sale of any securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
The AmTrust Financial Services, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3280
CONTACT: Elizabeth Malone CFA
(646) 458-7924
beth.malone@amtrustgroup.com
Hilly Gross
(646) 458-7923
hilly.gross@amtrustgroup.com
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