Fairfax Financial increases its offering to 10 million shares on strong demand
Fairfax Financial Holdings Ltd. quickly increased its preferred share offering to 10 million shares Monday after investors responded enthusiastically to a smaller offering earlier in the day.
The big Toronto-based insurance company said it now expects proceeds of $250 million from the offering in which the preferreds are priced at $25 each.
That’s an increase from the initial announcement of eight million shares for proceeds of $200 million.
Holders of the shares would receive a cumulative quarterly dividend with a five per cent annual return for the initial five-year period ended Dec. 31, 2015, Fairfax said.
The offering is expected to close around Oct. 5.
Fairfax said it plans to use the proceeds to enhance its cash position and increase its short-term investments and marketable securities, use it to pay future outstanding debt and for general corporate purposes.
Fairfax common shares were up $1.97 at $419.48 Monday afternoon on the Toronto Stock Exchange.
