Arch Capital Finance uses part of public offering to fund UGC acquisition

Arch Capital Group (Arch Capital) has confirmed the pricing of an offering of $500 million aggregate principal amount of 4.011 percent senior notes that are due in 2026 and $450 million aggregate principal amount of 5.031 percent senior notes due in 2046 of its wholly owned subsidiary Arch Capital Finance.

The notes will be unconditionally guaranteed by Arch Capital.

The company said that it intends to use the net proceeds of this offering to fund a portion of the cash consideration for the acquisition of United Guaranty Corporation (UGC) and AIG United Guaranty Insurance (Asia) from their current owner, American International Group, to pay related costs and expenses and for anticipated growth in its mortgage and other select businesses.

The closing of this offering is not contingent on the closing of the UGC acquisition. The offering is expected to close on December 8, 2016.