AM Best Co. has assigned a debt rating of 'bbb-' to the recently issued $250 million 8.875 percent senior unsecured notes, due 2040 of Bermuda-based reinsurer Validus Holdings Ltd.

The assigned outlook is stable.

The proceeds from the debt offering will be used for general corporate purposes, which may include the repurchase of outstanding capital stock, dividends to shareholders and/or potential acquisitions. Validus Holdings' debt-to-adjusted capital ratio and fixed charge coverage remain within the range expected for the assigned rating.

Validus Holdings is a provider of re/insurance, conducting its operations worldwide through two wholly owned subsidiaries, Validus Reinsurance Ltd. and Talbot Holdings Ltd.

Validus Re is a Bermuda-based reinsurer focused on short-tail lines of reinsurance, while Talbot is the Bermuda parent of the specialty insurance group primarily operating within the Lloyd's insurance market through Syndicate 1183.