Chilean Turns to Equity, Local bonds

Chilean financial services company Grupo Security, which agreed in March to acquire insurance company Cruz del Sur for from the Angelini Group, plans to raise equity capital and issue domestic bonds that could total $300m-equivalent, it says. Security plans to issue approximately 368m new shares as part of a shareholder-approved capital raise, which would mean CLP71.76bn ($154m) at Tuesday’s CLP195 closing price. The proceeds will be used to help cover the $300m-equivalent Cruz del Sur purchase, and come under a 500m-share 3-year program with a term of three years. Grupo Security will also use local market debt – a CLP70bn bank credit and up to UF3m ($147m) in domestic bonds with tenors of 20-25 years, as part of the financing. Security acquired a portfolio of insurance, investment and brokerage businesses operating under the Cruz del Sur brand.