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National General Holdings Sells a Baby Bond Issue

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Insurance company National General Holdings has sold a new $25 baby bond offering.

Details of the offering are here.

This issue will likely NOT trade on the OTC market prior to NASDAQ trading. The exact date when shares will begin trading is not known–sometime in the next 2 weeks is probable.

National General Holdings has 2 outstanding perpetual preferreds with similar coupons–these new shares are SUPERIOR to the preferred issues as they are debt and thus are higher on the food chain in the event of liquidation and additionally will have somewhat less volatility in the event of increased interest rates.  The maturity date on this issue, while not perpetual, is further out then we prefer to buy right now.

You can look at the 2 outstanding preferreds on the preferred stock swaps page here.

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