Chubb To Raise $1.2B In New Capital
NU Online News Service, June 17, 4:23 p.m. EDT? The Chubb Corporation has begun a new capital-raising effort this week to raise $1.2 billion. The Warren, N.J.-based property-casualty insurer said it will have two separate offerings consisting of 13.5 million shares of stock and 16 million equity units with an amount of $25 per unit.
The joint managers for Chubb's offerings are Citigroup, Goldman, Sachs & Co., and Merrill Lynch, all headquartered in New York.
Mark Greenberg, spokesperson for The Chubb Corp., told National Underwriter that the new capital would be used for "general corporate purposes."
"We want to build our businesses and grow our premiums. To do that, and if you want to maintain your ratings, you need more capital," Mr. Greenberg said.
He also dismissed any concern that the company may need capital for any further reserve strengthening, noting that "our reserves are adequate."
This past February, the company had increased its asbestos loss reserves by $75 million to reflect a reduced estimate of what it can recover from its reinsurance. That announcement was made as part of the insurer's 2002 fourth-quarter earnings release.
Founded in 1882, the Chubb Corporation provides property-casualty insurance for personal and commercial customers through independent agents and brokers. Its global network includes branches and affiliates throughout North America, Europe, Latin America, Asia and Australia.
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