SYDNEY, Nov 26 (Reuters) - QBE Insurance Group Ltd, Australia's top insurer by premium income, will buy U.S.-based underwriting agency ZC Sterling Corp for $575 million, part funded by a $1.3 billion equity raising, and has upped its 2008 revenue growth target.
QBE would also buy three more underwriting agencies for a total cost of $120 million. The new purchases would help QBE to achieve gross written premium of A$16.5 billion in 2009.
The company said in a statement on Wednesday it plans to raise A$2 billion ($1.3 billion) through a share placement to help fund the acquisitions.
QBE, which earns about two-thirds of revenues from offshore, said the fall in Australian dollar against the U.S. dollar was having a positive impact on QBE's revenue. As a result, QBE raised its 2008 revenue growth forecast by 6.4 percent to A$13.3 billion.
QBE, which has completed more than 115 acquisitions in the past 25 years, said it plans to buy back up to A$1.25 billion in face value of its tier 1 perpetual securities issued in 2006 and 2007 in exchange for five-year senior notes.
The capital raising and exchange of notes is expected to strengthen QBE's capital base, the company said.
($1=A$1.53)
(Reporting by Denny Thomas; Editing by James Thornhill) Keywords: QBE/ (denny.thomas@reuters.com; +61 2 9373 1812; Reuters Messaging: denny.thomas.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
QBE would also buy three more underwriting agencies for a total cost of $120 million. The new purchases would help QBE to achieve gross written premium of A$16.5 billion in 2009.
The company said in a statement on Wednesday it plans to raise A$2 billion ($1.3 billion) through a share placement to help fund the acquisitions.
QBE, which earns about two-thirds of revenues from offshore, said the fall in Australian dollar against the U.S. dollar was having a positive impact on QBE's revenue. As a result, QBE raised its 2008 revenue growth forecast by 6.4 percent to A$13.3 billion.
QBE, which has completed more than 115 acquisitions in the past 25 years, said it plans to buy back up to A$1.25 billion in face value of its tier 1 perpetual securities issued in 2006 and 2007 in exchange for five-year senior notes.
The capital raising and exchange of notes is expected to strengthen QBE's capital base, the company said.
($1=A$1.53)
(Reporting by Denny Thomas; Editing by James Thornhill) Keywords: QBE/ (denny.thomas@reuters.com; +61 2 9373 1812; Reuters Messaging: denny.thomas.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.