Athene Prices $600 Million Junior Subordinated Debentures Offering

Rhea-AI Summary

Athene Holding has announced the pricing of $600 million in 6.625% fixed-rate reset junior subordinated debentures due 2054. The offering is expected to close on October 10, 2024, subject to customary conditions. Athene plans to use the net proceeds for general corporate purposes, which may include the future redemption or repurchase of its $600 million 6.375% Fixed-Rate Reset Perpetual Non-Cumulative Series C Preferred Stock.

The debentures are being offered through a shelf registration statement filed with the SEC. Wells Fargo Securities, BofA Securities, Goldman Sachs & Co. , and Morgan Stanley are acting as joint book-running managers, with several other firms serving as co-managers for the offering.

Positive

• Successful pricing of $600 million in junior subordinated debentures
• Potential to refinance existing preferred stock with potentially more favorable terms
• Strong interest from multiple major financial institutions acting as managers for the offering

Negative

• Increase in long-term debt obligations
• Additional interest expense from the new debentures

Insights

Financial Analyst

Athene's $600 million junior subordinated debentures offering at 6.625% fixed-rate reset is a significant capital-raising move. This long-term debt instrument, maturing in 2054, provides the company with substantial financial flexibility. The intended use for general corporate purposes, including potential redemption of existing preferred stock, suggests a strategic approach to capital structure optimization. The 6.625% rate, while higher than their existing 6.375% preferred stock, reflects current market conditions and the subordinated nature of the debt. This offering may improve Athene's financial leverage and could potentially lead to lower overall cost of capital if used to replace higher-cost securities. The involvement of major financial institutions as joint book-running managers indicates strong market interest and credibility for the offering.

Market Research Analyst

This debenture offering by Athene is noteworthy in the current economic climate. The 6.625% rate is competitive, reflecting both the company's credit standing and investor appetite for yield in a rising interest rate environment. The 30-year term to 2054 is particularly long, indicating investor confidence in Athene's long-term prospects. The potential redemption of the Series C Preferred Stock suggests a shift from equity-like instruments to debt, which could be viewed positively by equity investors due to the reduced dilution risk. However, it also increases financial leverage, which warrants monitoring. The broad syndicate of underwriters, including global banks and boutique firms, suggests a wide distribution of the offering, potentially diversifying Athene's investor base. This successful debt placement may positively impact Athene's stock by demonstrating strong market access and financial flexibility.

WEST DES MOINES, Iowa, Oct. 07, 2024 (GLOBE NEWSWIRE) -- Athene Holding Ltd. (“Athene”) today announced it has agreed to sell $600 million aggregate principal amount of 6.625% fixed-rate reset junior subordinated debentures due 2054. The offering is expected to close on October 10, 2024, subject to satisfaction of customary closing conditions.

Athene intends to use the net proceeds from the offering for general corporate purposes, which may include the future redemption or repurchase of its $600,000,000 6.375% Fixed-Rate Reset Perpetual Non-Cumulative Series C Preferred Stock. This press release does not constitute a notice of redemption with respect to, or an offer to purchase, any securities.

Wells Fargo Securities, BofA Securities, Goldman Sachs & Co. LLC and Morgan Stanley are acting as joint book-running managers for the offering. Apollo Global Securities, BMO Capital Markets, BNP PARIBAS, Ramirez & Co., Inc., SOCIETE GENERALE, Siebert Williams Shank and SMBC Nikko are acting as co-managers for the offering.

The debentures are being offered pursuant to an effective shelf registration statement that has previously been filed with the Securities and Exchange Commission (the “SEC”). This press release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. Any offer, or solicitation to buy, if at all, will be made solely by means of a prospectus and related prospectus supplement filed with the SEC. You may obtain these documents without charge from the SEC at www.sec.gov. Alternatively, you may request copies of these materials from the joint book-running managers by contacting Wells Fargo Securities, LLC toll-free at (800) 645-3751, BofA Securities, Inc. toll-free at (800) 294-1322, Goldman Sachs & Co. LLC toll-free at (866) 471-2526 or Morgan Stanley & Co. LLC toll-free at (866) 718-1649.

About Athene

Athene is a leading retirement services company with $330 billion of total assets as of June 30, 2024, and operations in the United States, Bermuda, Canada, and Japan. Athene is focused on providing financial security to individuals by offering an attractive suite of retirement income and savings products and also serves as a solutions provider to corporations.

Forward-Looking Statements

This press release contains, and certain oral statements made by Athene's representatives from time to time may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are subject to risks, uncertainties and assumptions that could cause actual results, events and developments to differ materially from those set forth in, or implied by, such statements. These statements are based on the beliefs and assumptions of Athene's management and the management of Athene's subsidiaries. Generally, forward-looking statements include actions, events, results, strategies and expectations and are often identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans,” “seeks,” “estimates,” “projects,” “may,” “will,” “could,” “might,” “should,” or “continues” or similar expressions. Forward-looking statements within this press release include, but are not limited to, statements regarding Athene’s expectations regarding the completion of, and the use of proceeds from, the sale of the debentures, future growth prospects and financial performance. Although Athene management believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. For a discussion of other risks and uncertainties related to Athene’s forward-looking statements, see its annual report on Form 10-K for the year ended December 31, 2023 and its quarterly report on Form 10-Q for the quarter ended June 30, 2024, which can be found at the SEC’s website www.sec.gov. All forward-looking statements described herein are qualified by these cautionary statements and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. Athene does not undertake any obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.

Contact:

Media Contact
Jeanne Hess
VP, External Relations
+1 646 768 7319
jeanne.hess@athene.com

FAQ

What is the interest rate and maturity of Athene's (ATH) new junior subordinated debentures?

Athene's new junior subordinated debentures have a 6.625% fixed-rate reset interest rate and are due in 2054.

How much is Athene (ATH) raising through its junior subordinated debentures offering?

Athene is raising $600 million through its junior subordinated debentures offering.

When is the expected closing date for Athene's (ATH) $600 million debentures offering?

The expected closing date for Athene's $600 million debentures offering is October 10, 2024.

What does Athene (ATH) plan to use the proceeds from the debentures offering for?

Athene plans to use the proceeds for general corporate purposes, which may include redeeming or repurchasing its $600 million 6.375% Fixed-Rate Reset Perpetual Non-Cumulative Series C Preferred Stock.