CHATTANOOGA, Tenn. (Sept. 9, 2019) – Unum Group (NYSE: UNM) (the “Company”) announced today that it has given notice to redeem all of the Company’s 3.00% senior notes due 2021 (CUSIP Number 91529Y AM8) (the “2021 Notes”) outstanding on October 9, 2019 (the “Redemption Date”). The Company will redeem all of the outstanding 2021 Notes at a redemption price equal to the greater of: (1) 100% of the aggregate principal amount of the 2021 Notes plus any accrued but unpaid interest on the 2021 Notes to the Redemption Date and (2) the Make-Whole Redemption Amount (as defined in the 2021 Notes). As of the date of this news release, $350,000,000 aggregate principal amount of the 2021 Notes is outstanding.
The Company has instructed The Bank of New York Mellon Trust Company, N.A., the trustee and paying agent for the 2021 Notes, to distribute a notice of redemption to all registered holders of the 2021 Notes. The 2021 Notes must be surrendered to The Bank of New York Mellon Trust Company, N.A., to collect the redemption price pursuant to the notice of redemption.
The 2021 Notes are being redeemed in connection with (1) the Company’s sale of its $450,000,000 aggregate principal amount of 4.500% senior notes due 2049 (the “2049 Notes”) and (2) the Company’s cash tender offer (the “tender offer”) for up to a combined aggregate purchase price of $450,000,000 (which the Company increased from a combined aggregate purchase price of $300,000,000 on the day of commencement) of its (i) 7.405% Capital Securities due 2038 issued by Provident Financing Trust I, a wholly-owned subsidiary of the Company, $226,500,000 aggregate liquidation amount of which is outstanding, (ii) 7.190% senior notes due 2028, $48,780,000 aggregate principal amount of which is outstanding, (iii) 7.250% senior notes due 2028, $200,000,000 aggregate principal amount of which is outstanding, (iv) 6.750% senior notes due 2028, $165,844,000 aggregate principal amount of which is outstanding, and (v) the 2021 Notes (together, the “targeted securities”).
The Company intends to use the net proceeds from the sale of the 2049 Notes to purchase any targeted securities accepted for payment in the tender offer and, along with cash on hand, to fund the redemption of the 2021 Notes not purchased in the tender offer. The balance of the net proceeds, if any, will be used for general corporate purposes, which could include additional redemptions or repurchases of outstanding debt.
This news release shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
SAFE HARBOR STATEMENT
Certain information in this news release constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those not based on historical information, but rather relate to our outlook, future operations, strategies, financial results, or other developments and speak only as of the date made. These forward-looking statements, including statements about the use of proceeds, are subject to numerous assumptions, risks, and uncertainties, many of which are beyond our control. The following factors, in addition to other factors mentioned from time to time, may cause actual results to differ materially from those contemplated by the forward-looking statements: (1) sustained periods of low interest rates; (2) fluctuation in insurance reserve liabilities and claim payments due to changes in claim incidence, recovery rates, mortality and morbidity rates, and policy benefit offsets due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, the effectiveness of our claims operational processes, and changes in governmental programs; (3) unfavorable economic or business conditions, both domestic and foreign, that may result in decreases in sales, premiums, or persistency, as well as unfavorable claims activity; (4) changes in or interpretations of laws and regulations, including tax laws and regulations; (5) a cyber attack or other security breach could result in the unauthorized acquisition of confidential data; (6) the failure of our business recovery and incident management processes to resume our business operations in the event of a natural catastrophe, cyber attack, or other event; (7) investment results, including, but not limited to, changes in interest rates, defaults, changes in credit spreads, impairments, and the lack of appropriate investments in the market which can be acquired to match our liabilities; (8) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (9) changes in our financial strength and credit ratings; (10) our ability to execute on our technology systems upgrades or replacements; (11) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, external events, and/or inadequate or failed internal controls and procedures; (12) actual experience in the broad array of our products that deviates from our assumptions used in pricing, underwriting, and reserving; (13) changes in accounting standards, practices, or policies; (14) effectiveness of our risk management program; (15) contingencies and the level and results of litigation; (16) availability of reinsurance in the market and the ability of our reinsurers to meet their obligations to us; (17) ineffectiveness of our derivatives hedging programs due to changes in the economic environment, counterparty risk, ratings downgrades, capital market volatility, changes in interest rates, and/or regulation; (18) fluctuation in foreign currency exchange rates; (19) ability to generate sufficient internal liquidity and/or obtain external financing; (20) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; and (21) terrorism, both within the U.S. and abroad, ongoing military actions, and heightened security measures in response to these types of threats.
For further discussion of risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Part 1, Item 1A “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2018 and our subsequently filed quarterly reports on Form 10-Q. The forward-looking statements in this news release are being made as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise.
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About Unum Group
Unum Group (NYSE: UNM), an international provider of workplace benefits and services, has been helping workers and their families for 175 years. Through its Unum and Colonial Life brands, the company offers disability, life, accident, critical illness, dental, vision and stop-loss insurance; leave and absence management support and behavioral health services. In 2022, Unum reported revenues of about $12 billion and paid $8 billion in benefits. The Fortune 500 company is one of the 2023 World’s Most Ethical Companies, recognized by Ethisphere®.