Fairfax Financial - prices US$750 mln senior notes due 2056 at 100% issue price

Fairfax Financial Holdings Limited (TSX: FFH and FFH.U) has priced a private offering of US$750 million in senior notes due 2056 at an issue price of 100%. The notes are unsecured and will carry a fixed interest rate of 6.100% per annum. The offering is part of the company’s ongoing capital management strategy and is intended to support long-term financial flexibility.

The offering was led by a group of joint book-running managers, including BofA Securities, Inc., BMO Capital Markets, Citigroup Global Markets, Inc., and J.P. Morgan Securities LLC. The transaction closed on June 24, 2024, and the net proceeds will be used to redeem outstanding $500 million Senior Notes due 2025 issued by Allied World Assurance Company Holdings I, Ltd, a subsidiary of Fairfax, with any remaining funds allocated for general corporate purposes.

Fairfax, a holding company primarily engaged in property and casualty insurance and reinsurance, has consistently utilized debt offerings to optimize its capital structure and support strategic initiatives. The company has also entered into a registration rights agreement in connection with the offering.

The notes were issued through a private placement to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S of the U.S. Securities Act of 1933. As such, the notes are not registered under the Securities Act and may not be offered or sold in the United States without registration or an applicable exemption.

This offering reflects Fairfax’s continued access to capital markets and its ability to secure long-term financing at favorable terms. The company has maintained a strong balance sheet and a diversified business model, which supports its ability to manage debt obligations and pursue growth opportunities.