RenRe to sell $750m in senior notes

RenaissanceRe is to sell $750 million worth of 10 year senior notes which will be used to fund part of its purchase of American International Group subsidiary Validus.

The company said the notes carry a coupon of 5.75% and will close on June 5.

The senior notes are expected to be rated A3 by Moody’s Investors Service, BBB+ by Standard & Poor’s, and A- by Fitch Ratings. Morgan Stanley, Barclays, HSBC, Wells Fargo Securities, and BofA Securities served as joint book-running managers.

RenaissanceRe announced last month it was buying Validus Holdings and its subsidiaries, including AlphaCat Managers and the Talbot Treaty reinsurance business, for $2.99 billion, consisting of $2.74 billion in cash and $250 million in RenaissanceRe common shares.

AIG also expects to make significant investments in RenaissanceRe’s DaVinci Reinsurance and Fontana Reinsurance managed funds through AIG’s investment portfolio.