20th Century Industries’ Stock Offering Cut Back

A public offering of 20th Century Industries’ stock was cut back last week because of the declining price of the company’s shares.

The Woodland Hills-based company, the parent of 20th Century Insurance, announced in early April that it and five major shareholders will offer 4.6 million shares to the public. Last week, however, only 3.4 million shares were sold for $18.625 each.

20th Century, which specializes in auto insurance, raised $63.325 million, before taking underwriting expenses into account, from the offering.

The reduction in the amount of stock offered partly reflected a decision by the five major shareholders to scrap plans to sell 600,000 of their own shares. Those shareholders included 20th Century Chairman Louis W. Forster, who originally planned to offer 300,000 shares, and Rachford Harris, a board member, who had planned to sell 200,000 shares.

All 3.4 million shares that were sold to the public came from 20th Century itself, which previously said it would offer 4.0 million shares.

James K. Chiu, a vice president with Merrill Lynch Capital Markets, the lead underwriter for 20th Century, said the company scaled back the offering because of the decline in the price of the company’s stock, from about $24 a share at the time of the announcement to less than $20 last week. The stock closed Monday at $19.875.

Chiu attributed the drop in the company’s stock price to the cooling off of the stock market and investor concern about the health of the entire insurance industry.