The Hartford Offerings Raise $1.95 Billion

The Hartford Offerings Raise $1.95 Billion

NU Online News Service, May 20, 4:06 p.m. EDT?The Hartford Financial Services Group said the $1.95 billion it has made from capital offerings is $100 million more than originally expected.

The Hartford, Conn.-based company said it raised some $1.1 billion from 24.2 million shares of common stock priced at $45.50 per share and $600 million from 12 million equity units that are automatically convertible into common stock in three years. Additionally, the company also raised $250 million from three-year debt securities.

These offerings are part of The Hartford's plan to shore up its balance sheet after announcing an increase of its asbestos reserves by $2.6 billion and posting a $1.7 billion charge to first-quarter earnings.

The company said it has already sold most of its reinsurance unit to Endurance Specialty Holdings in Bermuda and is eliminating 1,500 jobs. (See NU Online News Service, May 16)

The Hartford said it will spend some $1.5 billion of the net proceeds from these offerings to strengthen the capital position of its property-casualty units and use $150 million for its life insurance operations.

The rest, the company said, would be used for general corporate purposes, possibly including a contribution to its pension plan and additional contributions to its subsidiaries.

The Hartford reported total assets of $188.7 billion at the end of this year's first quarter.