SiriusPoint Announces Pricing of Tender Offer for 4.600% Senior Notes due 2026

Rhea-AI Summary

SiriusPoint announces the results of the pricing of its cash tender offer for its 4.600% Senior Notes due 2026, providing details on the Total Consideration and pricing terms. The Tender Offer expires on April 19, 2024, with SiriusPoint aiming to settle for Notes tendered by April 5, 2024.

Insights

Financial Analyst

The tender offer and consent solicitation announced by SiriusPoint Ltd. for its 4.600% Senior Notes due 2026 is a significant event for both the company and its bondholders. The pricing terms indicate a fixed spread of 45 basis points over the reference Treasury yield, which is a typical margin for such corporate debt instruments. The early tender payment of $50 per $1,000 principal amount suggests an incentive for bondholders to participate before the early expiration time. The total consideration of $1,000 per $1,000 principal amount reflects the company's assessment of the present value of the remaining payments discounted at the reference yield plus the fixed spread.

From a financial perspective, this maneuver could imply SiriusPoint's strategy to manage its debt profile by potentially reducing interest expenses or altering the maturity structure of its liabilities. The market will interpret this move as a signal of the company's liquidity position and its ability to refinance or retire its existing debt. The conditions mentioned, including a financing condition, suggest that SiriusPoint is looking to maintain financial flexibility, which is critical in the current economic environment.

Debt Capital Markets Expert

Examining the tender offer through the lens of debt capital markets, SiriusPoint's decision to repurchase its outstanding 2026 Notes can be indicative of its capital structure optimization. The company's choice to execute this transaction now could be driven by favorable market conditions or a strategic shift in its leverage policy. The timing and pricing of the tender offer, particularly in relation to the reference Treasury security, are key components that will affect the success of the tender offer and the company's subsequent cost of capital.

Investors and stakeholders should note the potential impact on SiriusPoint's credit ratings and the secondary market pricing of its other debt instruments. The tender offer's impact on the company's weighted average cost of capital (WACC) will also be a focal point, as it influences investment decisions and valuation metrics. The financing condition mentioned indicates reliance on market liquidity and possibly the issuance of new debt, which could affect the company's interest expense and leverage ratios going forward.

Market Research Analyst

From a market research perspective, the tender offer for SiriusPoint's 2026 Notes provides insights into investor sentiment and market dynamics. The acceptance of the offer by bondholders will reveal their confidence in the company's future cash flows and creditworthiness. Additionally, the early tender payment serves as a strategic tool to gauge immediate market interest and can be compared to similar corporate actions within the industry to assess competitiveness.

It is important to monitor the participation rate in the tender offer as it concludes, as this will indicate the level of investor alignment with SiriusPoint's valuation of the notes. Moreover, the company's ability to successfully complete the tender offer and consent solicitation could influence investor perception and potentially the stock price, as it reflects on management's capability to execute financial strategies effectively.

HAMILTON, Bermuda, April 04, 2024 (GLOBE NEWSWIRE) -- SiriusPoint Ltd. (“SiriusPoint” or the “Company”) (NYSE: SPNT) announced today the results of the pricing of its previously announced cash tender offer (the “Tender Offer”) for any and all of its 4.600% Senior Notes due 2026 (the “2026 Notes”).

The Tender Offer and related consent solicitation (the “Consent Solicitation”) were made pursuant to an Offer to Purchase and Consent Solicitation Statement, dated March 21, 2024 (as may be amended or supplemented from time to time, the “Offer to Purchase”).

The table below sets forth the Total Consideration and summarizes certain pricing terms for the Tender Offer:

Title of Security

CUSIP Number & ISIN (144A / Reg S)

Principal Amount Outstanding

Reference Treasury Security(1)

Bloomberg Reference Page

Reference Yield(1)

Fixed Spread (bps)

Early Tender Payment (per $1,000)

Total Consideration (per $1,000)(2)

4.600% Senior Notes due 2026

82968FAA2 / G8201FAA7 US82968FAA21 / USG8201FAA78

$400,000,000

1.875% UST due July 31, 2026

FIT5

4.618%

+45

$50

$1,000.00

_________

(1)   Calculated based on the bid-side price of the Reference Treasury Security as quoted on the Bloomberg Reference Page at 10:00 a.m., New York City time, on April 4, 2024.

(2)   The total consideration offered per $1,000 principal amount of 2026 Notes validly tendered and accepted for purchase prior to the Early Expiration Time (as defined below) pursuant to the Tender Offer (the “Total Consideration”) was determined by the Dealer Managers (as defined below) in the manner described in the Offer to Purchase and was made equal to the greater of (x) the sum of the present value of the remaining payments of principal and interest on the 2026 Notes from the settlement date to (but excluding) August 1, 2026 (three months prior to the maturity date of the 2026 Notes), at a discount rate equal to the sum of the Fixed Spread plus the Reference Yield and (y) $1,000.

The Total Consideration includes an early tender payment of $50 for each $1,000 principal amount of 2026 Notes to holders who validly tender 2026 Notes and deliver consents by a deadline of 5:00 p.m., New York City time, on April 4, 2024, unless extended or earlier terminated by SiriusPoint (the “Early Expiration Time”). The 2026 Notes tendered may be withdrawn and consents for the Proposed Amendment delivered may be revoked at any time prior to the Early Expiration Time, but not thereafter, except as may be required by applicable law. Those who validly tender 2026 Notes and deliver consents before the Early Expiration Time will receive the Total Consideration for each $1,000 principal amount of accepted 2026 Notes. Those who validly tender 2026 Notes and deliver consents after the Early Expiration Time will receive the Total Consideration, less $50, for each $1,000 principal amount of accepted 2026 Notes. In each case, holders of such accepted 2026 Notes will receive accrued and unpaid interest to (but excluding) the settlement date. The Tender Offer expires at 5:00 p.m., New York City time, on April 19, 2024, unless extended or earlier terminated by SiriusPoint (the “Tender Offer Expiration”).

SiriusPoint intends to initiate settlement for Notes validly tendered by the Early Expiration Time on April 5, 2024. SiriusPoint’s obligation to accept for purchase, and to pay for, 2026 Notes validly tendered and not validly withdrawn pursuant to the Tender Offer and the Consent Solicitation is conditioned upon the satisfaction or, when applicable, waiver of certain conditions, which are more fully described in the Offer to Purchase, including, among others, a financing condition requiring the consummation of a notes offering described therein. In addition, subject to applicable law, SiriusPoint has reserved the right, in its sole discretion, to (i) extend, terminate or withdraw the Tender Offer or the Consent Solicitation at any time or (ii) otherwise amend the Tender Offer or the Consent Solicitation in any respect at any time and from time to time. SiriusPoint has further reserved the right, in its sole discretion, not to accept any tenders of 2026 Notes or deliveries of consents with respect to the 2026 Notes.

BMO Capital Markets Corp., HSBC Securities (USA) Inc., Jefferies LLC and J.P. Morgan Securities LLC have acted as dealer managers for the Tender Offer and as solicitation agents for the Consent Solicitation (the “Dealer Managers”). For questions regarding the Tender Offer and the Consent Solicitation, the Dealer Managers can be contacted as follows: BMO Capital Markets Corp. at (833) 418-0762, HSBC Securities (USA) Inc. at (888) 472-2456, Jefferies LLC at (877) 877-0696 and J.P. Morgan Securities LLC at (866) 834-4666.

Copies of the Offer to Purchase have been made available to holders of 2026 Notes from D.F. King & Co., Inc., the information agent and the tender agent for the Tender Offer and the Consent Solicitation. Requests for copies of the Offer to Purchase should be directed to D.F. King & Co., Inc. toll-free at (866) 388-7535 or SPNT@dfking.com.

Cautionary Note Regarding Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond the Company’s control. The Company cautions you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “believes,” “intends,” “seeks,” “anticipates,” “aims,” “plans,” “targets,” “estimates,” “expects,” “assumes,” “continues,” “should,” “could,” “will,” “may” and the negative of these or similar terms and phrases. Actual events, results and outcomes may differ materially from the Company’s expectations due to a variety of known and unknown risks, uncertainties and other factors. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements are the following: the Company’s ability to execute on its strategic transformation, including re-underwriting to reduce volatility and improving underwriting performance, de-risking the Company’s investment portfolio, and transforming the Company’s business; the impact of unpredictable catastrophic events including uncertainties with respect to current and future COVID-19 losses across many classes of insurance business and the amount of insurance losses that may ultimately be ceded to the reinsurance market, supply chain issues, labor shortages and related increased costs, changing interest rates and equity market volatility; inadequacy of loss and loss adjustment expense reserves, the lack of available capital, and periods characterized by excess underwriting capacity and unfavorable premium rates; the performance of financial markets, impact of inflation and interest rates, and foreign currency fluctuations; the Company’s ability to compete successfully in the insurance and reinsurance market and the effect of consolidation in the insurance and reinsurance industry; technology breaches or failures, including those resulting from a malicious cyber-attack on the Company, the Company’s business partners or service providers; the effects of global climate change, including increased severity and frequency of weather-related natural disasters and catastrophes and increased coastal flooding in many geographic areas; geopolitical uncertainty, including the ongoing conflicts in Europe and the Middle East; the Company’s ability to retain key senior management and key employees; a downgrade or withdrawal of the Company’s financial ratings; fluctuations in the Company’s results of operations; legal restrictions on certain of SiriusPoint’s insurance and reinsurance subsidiaries’ ability to pay dividends and other distributions to SiriusPoint; the outcome of legal and regulatory proceedings and regulatory constraints on the Company’s business; reduced returns or losses in SiriusPoint’s investment portfolio; the Company’s exposure or potential exposure to corporate income tax in Bermuda and the E.U., U.S. federal income and withholding taxes and the Company’s significant deferred tax assets, which could become devalued if the Company does not generate future taxable income or applicable corporate tax rates are reduced; risks associated with delegating authority to third party managing general agents; future strategic transactions such as acquisitions, dispositions, investments, mergers or joint ventures; SiriusPoint’s response to any acquisition proposal that may be received from any party, including any actions that may be considered by the Company’s Board of Directors or any committee thereof; and other risks and factors listed under “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and other subsequent periodic reports filed with the Securities and Exchange Commission. All forward-looking statements speak only as of the date made and the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

About the Company

SiriusPoint is a global underwriter of insurance and reinsurance providing solutions to clients and brokers around the world. Bermuda-headquartered with offices in New York, London, Stockholm and other locations, the Company is listed on the New York Stock Exchange (SPNT). SiriusPoint has licenses to write Property & Casualty and Accident & Health insurance and reinsurance globally. SiriusPoint’s offering and distribution capabilities are strengthened by a portfolio of strategic partnerships with Managing General Agents and Program Administrators within the Company’s Insurance & Services segment.

SiriusPoint Contacts

Investor Relations
Dhruv Gahlaut, Head of Investor Relations and Chief Strategy Officer
Dhruv.gahlaut@siriuspt.com
+44 7514 659 918

Media
Sarah Hills, Rein4ce
Sarah.hills@rein4ce.co.uk
+ 44 7718882011

FAQ

What is the purpose of SiriusPoint's Tender Offer?

SiriusPoint announced a cash tender offer for its 4.600% Senior Notes due 2026 to repurchase any and all outstanding notes.

When does the Tender Offer expire?

The Tender Offer expires at 5:00 p.m., New York City time, on April 19, 2024, unless extended or terminated earlier by SiriusPoint.

How can holders participate in the Tender Offer?

Holders can tender their 2026 Notes and deliver consents before the Early Expiration Time to receive the Total Consideration per $1,000 principal amount of accepted notes.

Who are the Dealer Managers for the Tender Offer?

BMO Capital Markets Corp., HSBC Securities (USA) Inc., Jefferies , and J.P. Morgan Securities are the dealer managers for the Tender Offer and Consent Solicitation.

What happens if 2026 Notes are tendered after the Early Expiration Time?

Holders who tender 2026 Notes after the Early Expiration Time will receive the Total Consideration less $50 for each $1,000 principal amount of accepted notes.