Bermuda-based reinsurer Alterra Capital Holdings Ltd. is to raise $350 million on the capital markets.

The company announced yesterday that its wholly-owned subsidiary, Alterra Finance LLC, had priced the offering of its 6.25 percent senior notes due in 2020.

The closing of the offering is expected to occur on or about September 27, 2010, subject to customary closing conditions.

The net proceeds of the offering will be used to repay a $200 million revolving loan outstanding under a credit agreement of a wholly-owned subsidiary of Alterra. The remaining proceeds will be used for general corporate purposes.