HCC RENEWS ITS REVOLVING LOAN FACILITY AND COMMENTS ON
ITS CONVERTIBLE DEBT
HOUSTON (November 29, 2004) . . .
HCC Insurance Holdings, Inc. (NYSE symbol: HCC) announced today that the Company had reached an agreement with a group of
banks led by Wells Fargo and with Wachovia Bank as syndication agent, to
renew its revolving loan facility. This $200 million facility has been
renewed for a five year term with interest calculated at the Company’s
option at a variable rate based upon the announced prime lending rate of
Wells Fargo plus 50 basis points, or 75 basis points over LIBOR. The renewed
facility contains loan covenants and other terms more favorable to the
Company than the expiring facility.
HCC has additional debt in the form of two convertible notes totaling
approximately $300 million. The recently announced exchange of the Company’s
2% convertible notes provides improved flexibility in dealing with the FASB
accounting change to take effect on December 15, 2004, which is expected to
retroactively change the way the Company’s convertible debt is considered in
the calculation of diluted earnings per share.
Commenting on this change, Stephen L. Way, Chairman and Chief Executive
Officer of HCC, said, “Despite the unreasonable nature of a retroactive
accounting change affecting a business decision made several years ago which
conformed to GAAP standards at the time, we have positioned the Company to
avoid most of the earnings dilution that would result from this change.” Mr.
Way added, “As is our Company philosophy, we continue to look at all
financing alternatives to maintain our very strong balance sheet and stay
well positioned to take advantage of new opportunities in our specialty
businesses.”
HCC is an international insurance holding company and a leading specialty
insurance group since 1974, based in Houston, Texas with offices across the
USA and in Bermuda, England and Spain. HCC has assets of more than $5
billion, shareholders’ equity of over $1 billion and is rated AA (Very
Strong) by Standard & Poor’s and A+ (Superior) by A.M. Best Company.
For more information, visit our website at
www.hcch.com.
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Contact:
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L. Byron Way, Vice
President
HCC Insurance Holdings, Inc.
Telephone: (713) 690-7300
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Forward-looking statements contained in this press
release are made under “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995 and involve a number of risks
and uncertainties. The types of risks and uncertainties which may
affect the Company are set forth in its periodic reports filed with
the Securities and Exchange Commission. |
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