PMI plans $207 million mandatory to help fund FGIC acquisition

Nashville, Aug. 4 - The PMI Group Inc. said it plans a $207 million equity-linked, or convertible, offering in addition to a $100 million stock offering to help fund its part of the purchase of Financial Guaranty Insurance Co. from General Electric Co.

PMI said it will file a universal shelf registration statement with the Securities and Exchange Commission, so timing of the offerings has not been determined.

General Electric agreed to sell the bond insurance unit to an investor group led by mortgage insurer PMI for about $1.875 billion, but is retaining a 5% equity stake in the company and will continue to hold $235 million in preferred stock.

PMI will own 42% and control five of the company's 14 board seats. Other investors are Blackstone Group and Cypress Group, each with 23%, and CIVC Partners with 7%.

PMI said in a conference call it has a plan to eventually gain majority control over FGIC.

PMI shares gained 8c to $32.85.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.