Prudential Financial: Nippon Life To Buy $500 Million 10-Year Surplus Note
17 September 2009 - 8:58AM
Dow Jones News
Prudential Financial Inc. (PRU) said Wednesday after the market
close that Nippon Life Insurance Co. has signed an agreement to
purchase a $500 million 10-year exchangeable surplus note.
Prudential will pay interest at an annual rate of 5.36. The note
can be exchanged at Nippon's option for common stock after five
years to give Nippon up to a 9.9% stake in Prudential, the press
release said. The transaction is expected to close Friday.
Nippon, based in Osaka, Japan, is a mutual insurer that offers
annuities, life, medical, and nursing coverage and had year-end
2008 total assets of $467 billion, and 2008 revenue of $67
billion.
Nippon owns a 7% stake in Principal Financial Group (PFG) and
has had an ongoing business relationship with Principal for more
than 20 years. It is Principal's largest shareholder.
Shares of Prudential closed up 7.4% Wednesday at $54.63, but
traded down 3.8% at $52.54 after the market closed.
-By Lavonne Kuykendall, Dow Jones Newswires; (312) 750 4141;
lavonne.kuykendall@dowjones.com