Lincoln National reveals financial plans - Triangle Business Journal:

grachevakautawil.blogspot.com
Shares closed 11 percent lower Monday at on a day the markets lost more than 2 Lincoln National said it will targetabout $950 milliom in preferred stock from TARP’ Capital Purchase Program. It will also try and raisd $600 million through a common stock offeringand $500 million in senior The underwriters of the offering will have a 30-day optioj to buy up to an additionao 15 percent of the offered amount of common sharews from the company.
Lincoln Nationa l said it intends to contributeabout $1 billiohn of the proceeds to its principal insurance , with the remaining $1 billion held at the holding company for general corporate including the repayment of short-term debt and investment in the company’d core businesses. In a separate releas Monday announcinganother cost-cutting Lincoln National said that it agreed to sell its Britisgh subsidiary, Lincoln National (UK) plc, to SLF of Canadaq UK Ltd. for an estimates 195 British pounds. Lincoln said the transaction, expecte d to close on or around 30, should generate estimated proceedsz ofbetween $280 million and $300 million, whicu will be used for core U.S.
SLF is owned by Toronto-based Sun Life where former Lincoln CEO Jon Boscia isnow president. Lincol National said these actions supplemenrdividend reductions, cost and other actions previously takejn to strengthen its capital and and solidify the company’s capital positions at both the subsidiary and holding company levels. The Philadelphia-basedx company believes that TARP participation provides additionapcapital flexibility. The company expects to repay thisfinancing “as soon as practicable, taking into consideration appropriate balancr sheet strength and capital markets conditions.
” The final level of Lincoln’s participation is expecter to be announced by the end of June. Last Lincoln National received preliminary approval for upto $2.5 billion unde the program. It said the exacty level of its participation will be determined by the end of this Lincoln is one of six insurance companiezs to receivesuch approval. The $700 billiomn Troubled Asset Relief Program, approved by Congress last was originally intended to buy toxic loans that were inhibitintg banks from makingadditionap loans. But it was also used to make loans to General Motors Corp.
, Chrysler and insurance giant Lincolnj National was one of severakl insurers that applied to become thrift holdinfg companies last fall so they coulrd be considered for TARP funds. The insurersw had concerns about the rising number of bad assetws ontheir books. Lincoln National and other insurerw saw their stock prices drop in recentr months as they waited for government As for thestock offering, and Merrillk Lynch & Co. will serve as globao coordinators and GoldmanSachs & Co. and Morgan Stanleyy & Co. Inc. will serve as joinr book-running managers.
In explaining its decision in a regulatory Lincoln National said that although the capital and credir markets have shown recent those markets have experienced extreme volatility and disruptionb for more thana “Given these conditions, our capitalo strategy is to have sufficient capital to offe r downside protection in the evenft that the capital and credit market s experience another downturn as well as to supporrt growth in our operating the company said. Lincoln Nationap said it believes thatthe $2 billion infusiohn will provide it with sufficient capital to offset a “stresds scenario” analysis for 2009 and 2010.
That scenarioo would include credit losses and impairments amountinbg toapproximately $1.65 billion, or 2.5 percent based on invested assetsz as of March 31. Lincoln (NYSE:LNC), which market itself as , offerzs both insurance and investmentmanagement