NU Online News Service, Dec. 3, 11:55 a.m. – Principal Financial Group Inc., Des Moines, Iowa, hopes to raise more than $300 million in the next few months by selling its remaining stake in Coventry Health Care Inc., Bethesda, Md.

Principal wants to sell some of the stock to the public, and some back to Coventry, the company says.

Coventry has filed a registration statement describing the proposed transactions with federal securities regulators, but, at press time, it was not yet available on the Web.

Principal acquired Coventry stock in 1998, when it traded its health insurance operations to Coventry in exchange for stock.

Principal has sold some of the stock over the years, but it still owns 15.2 million shares of stock, along with warrants that give it the right to buy 3.1 million more shares.

Principal now hopes to sell 8.1 million of the shares to the public and investment bankers through a “secondary public stock offering.”

Coventry has agreed to pay $141 million for the remaining 7.1 million shares, and $35 million for the warrants.

Coventry says it will finance its stock repurchase by borrowing $175 million.

Coventry intends to borrow the $175 million by selling senior notes to large institutional investors.

For the deal to take place, Coventry must be able to sell the senior notes, and Principal and its underwriters must be able to carry out the secondary stock offering, Coventry says.

Salomon Smith Barney Inc., New York, is acting as sole bookrunning lead manager of the secondary share offering, Coventry says.

The co-managers of the offering are Goldman, Sachs & Company Inc., New York; Lehman Brothers Inc., New York; and CIBC World Markets Corp., New York.