As noted by our reader SteveA, along with other readers, the new Unum Junior Subordinated Notes due 2058 have begun to trade on the NYSE.
All the details on the issue and the prospectus can be found here. Shares are trading right around $25 now. This is a large issue of 12 million shares plus another 1.8 million shares for overallotment.
We will have no personal interest in these baby bonds as we simply are not buying issues with maturity dates this far out–just too much interest rate risk right now. This doesn’t mean the issue is bad–just that it doesn’t fit with our current strategy of investing (which no doubt will change at some point in the future).
We do note that the interest on these baby bonds can be deferred for periods of up to 5 years without being a default–we have NEVER liked these provisions. Is it likely to happen? NO–but who knows over the course of 40 years.