April 26, 2018 / 1:08 PM / 5 months ago

AXA prices U.S. arm's IPO at $24-27/per share, launches bonds

* U.S. unit IPO priced between $24-$27 per share

* Could value division at $3.5 bln

* Planning U.S unit’s IPO in Q2

By Matthieu Protard

PARIS, April 26 (Reuters) - French insurer AXA on Thursday priced the forthcoming initial public offering (IPO) of its U.S. division at $24-27 per share, in a deal that could value the unit at $3.5 billion.

AXA said in a regulatory filing that it would offer 137.25 million shares in its U.S arm AXA Equitable Holdings Inc at $25.50, with that price representing the mid-point in the indicative price range of the IPO.

AXA also announced the launch of around $750 million bonds, mandatorily exchangeable into AXA Equitable Holdings shares.

AXA Equitable Holdings is one of America’s oldest life insurers, with roots going back to 1859 in New York. AXA acquired the business in 1992 and it is targeting a second-quarter IPO of its U.S. division.

AXA, which is Europe’s second-biggest insurer by market capitalisation behind Allianz, has said that the proceeds from its IPO deal will help finance its earlier acquisition of insurer XL Group.

AXA announced its $15 billion acquisition of XL in March to create a world leader in property and casualty insurance.

Insurers have been turning to takeovers to strengthen their businesses as they face tougher regulation and falling returns from financial market investments, with American International Group also buying reinsurer Validus for around $5.6 billion earlier this year.

Morgan Stanley, JP Morgan, Barclays and Citigroup are the main investment banks involved in the IPO of AXA’s U.S. business. (Reporting by Matthieu Protard; Additional reporting by Alan Charlish Editing by Sudip Kar-Gupta)

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