On Aug 6, Hartford Financial Services Group Inc. (HIG) successfully raised $900 million in a fresh equity offering. This increases the size of its discretionary equity issuance plan announced on June 12 by $150 million based on strong demand from various investors.

The company sold 56.1 million shares of common stock under the plan at an average price of $16.03 each. The company intends to utilize net proceeds from the offering for general corporate purposes and may even repurchase outstanding debt.

Goldman Sachs Group Inc. (GS) acted as the company’s sales agent for the offering.

In the past quarters, Hartford has been severely hurt by huge losses in its investment portfolio due to battered markets. The company also received $3.4 billion in government bailout.

Based in Connecticut, Hartford Financial is one of the largest multi-line insurance and investment companies in the country. It operates two broad segments: Life and Property-Casualty (P&C).

We remain concerned about the company’s exposure to variable annuities and suspect that Hartford will continue to incur increasing losses on its investment portfolio. However, the equity offering and the recently received $3.4 billion in TARP funds will strengthen its capital position and provide it with the much needed financial flexibility.

As such, we maintain our Hold recommendation on the stock.

Read the full analyst report on “HIG”
Read the full analyst report on “GS”
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