Assured Guaranty, a provider of credit enhancement products, has signed an agreement for WL Ross & Company to purchase $250 million of common shares of Assured and to provide a commitment to purchase up to $750 million of additional common shares of Assured at the option of the company.
The closing of the initial $250 million investment is subject to regulatory approvals and other customary conditions. The closing of any subsequent investments will require shareholder approval, which the company will request at its 2008 annual general meeting.
The purchase price per common share for the initial investment will be the higher of (i) 97% of the average of $22.43 (the company’s NYSE closing price on February 22, 2008) and the average NYSE closing price for February 29, 2008 and March 3, 2008, or (ii) $21.76 (97% of $22.43). A condition to closing the initial investment is that Wilbur Ross, chairman and CEO of WL Ross, will be appointed to the company’s board of directors.
The additional $750 million commitment by WL Ross is available at the option of the company for one year from the date of the closing of the $250 million investment. The price for subsequent investments will be 97% of the volume weighted average price of the company’s common shares for the 15 trading days prior to notice of any subsequent investment.
Dominic Frederico, president and CEO of Assured Guaranty, said: We are extremely pleased that Wilbur Ross has chosen Assured as his preferred investment vehicle in the financial guaranty industry. This flexible capital source will allow us to continue to capitalize on the significant growth opportunities we see and will support our further expansion in both the direct and reinsurance markets.