Lincoln to accept bailout

By Juan Lagorio | June 16, 2009, Tuesday |

Print Edition

LINCOLN Financial Group said yesterday that it would accept federal bailout money as part of a plan to raise US$2 billion that also includes sales of stock and debt.

The insurer said it planned to use proceeds to repay short-term debt and shore up its insurance subsidiary.

Lincoln said it would raise US$950 million by selling preferred stock to the government.

The firm is one of six big insurers the government in May allowed to tap the Troubled Asset Relief Program.

Four of the insurers have declined to accept funds, while Hartford Financial Services Group Inc said on Friday that it would accept up to US$3.4 billion.

Lincoln said it also planned to sell US$600 million of common stock and may boost this offering by US$90 million to meet demand.

It also plans to sell up to US$500 million of senior debt.

Lincoln said half of the money would go to fund the Lincoln National Life Insurance Co, while the remaining US$1 billion would go for general corporate purposes, including repaying short-term debt and investment in the firm's core businesses.

Lincoln National Corporation is a holding company with insurance and investment management businesses.

Finance

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Lincoln to accept bailout

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