AM Best Assigns Issue Credit Rating to Markel Corporation’s Recently Announced Senior Unsecured Notes
May 05 2021 - 12:40PM
Business Wire
AM Best has assigned a Long-Term Issue Credit Rating of
“bbb+” to $600 million of 3.45% senior unsecured notes due 2052
issued by Markel Corporation (Markel) (Glen Allen, Virginia) [NYSE:
MKL]. The outlook assigned to this Credit Rating (rating) is
stable. The debt ranks pari passu with the company’s outstanding
senior unsecured notes.
The proceeds will be used to prefund the scheduled retirement of
Markel’s $350 million of senior unsecured notes due July 2022, and
for general corporate purposes. The rating assignment considers the
rating profile of Markel’s principal insurance subsidiary units, as
well as the parent company’s financial leverage, coverage and
overall debt servicing profile, and the application of appropriate
notching to reflect structural subordination of the holding
company’s senior debt.
Markel’s financial leverage, as calculated by AM Best, was in
the low-to-mid 20% range at year-end 2020, and will remain in the
mid-to-upper 20% range following the new debt offering, prior to
consideration of proceeds held to pre-fund the retirement of
maturing debt in mid-2022. Earnings before interest, preferred
dividends and taxes interest coverage has been strong, averaging
3.9 times over the past three years, albeit declining to 2.9 times
in 2020. AM Best expects Markel’s coverage ratio to remain within
guidance. The company’s 2020 net operating earnings results were
affected by net claim losses associated with natural catastrophes,
pandemic-related event cancellation and business interruption
claims, and other losses sustained by its international and U.S.
insurance and reinsurance operations.
This press release relates to Credit Ratings that have been
published on AM Best’s website. For all rating information relating
to the release and pertinent disclosures, including details of the
office responsible for issuing each of the individual ratings
referenced in this release, please see AM Best’s Recent Rating
Activity web page. For additional information regarding the use and
limitations of Credit Rating opinions, please view Guide to Best’s
Credit Ratings. For information on the proper media use of Best’s
Credit Ratings and AM Best press releases, please view Guide for
Media - Proper Use of Best’s Credit Ratings and AM Best Rating
Action Press Releases.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
Copyright © 2021 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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version on businesswire.com: https://www.businesswire.com/news/home/20210505005890/en/
Alan Murray Senior Financial Analyst +1 908 439
2200, ext. 5535 alan.murray@ambest.com
Jennifer Marshall Director +1 908 439 2200,
ext. 5327 jennifer.marshall@ambest.com
Christopher Sharkey Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com
Jim Peavy Director, Communications +1 908 439
2200, ext. 5644 james.peavy@ambest.com
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