Financial services firm, the Hartford Financial Services Group, has said it will raise about $3.05 billion in securities to repay the financial aid it received from the US government.
Hartford Financial is planning to repurchase $3.4 billion worth of its preferred shares issued to the US Treasury Department in exchange for money injected by the government in 2009.
In a statement, the company said, "It is conducting a public offering of equity and debt securities as part of a plan to fully repurchase the $3.4 billion of Hartford's preferred shares issued to the US Treasury under Treasury's Capital Purchase Program (CPP)."
Following the repayment, the Treasury would continue to hold warrants to purchase about 52 million shares at an initial exercise price of $9.79 per share. Hartford Financial does not intend to repurchase the warrants.
Hartford Financial said it decided to make the public offering of debt and equity securities after consulting its primary regulator, the federal Office of Thrift Supervision.
The company said it would offer $1.45 billion in common stock, $500 million in convertible preferred stock, represented by the depositary shares.
Goldman Sachs & Co, and JP Morgan Securities would act as joint book-running managers for the offer.
"We appreciate the critical role the government and the American taxpayers have played in stabilising the financial markets and we are pleased to announce a plan to repurchase Treasury's investment in fewer than 10 months," the company's Chairman President and Chief Executive Officer Liam E McGee said.
At the peak of the global financial turmoil in 2008, the Federal government had come up with the $700 billion bailout plan, known as the Troubled Asset Relief Program (TARP) to boost the nation's battered financial sector.
Many financial institutions had received a cash investment from the Treasury in exchange for preferred stock.
