An insurer is testing the state of the capital markets.

Principal Financial Group Inc., Des Moines, Iowa, has priced a public offering of about 51 million shares of common stock at a price of $19.75 each.

The underwriters, who hope to raise $1 billion from public investors, have a 30-day option to spend about $160 million on additional shares of common stock to cover over-allotments, Principal says.

The offering is set to close Friday.

Principal “intends to use the net proceeds from the offering for general corporate purposes,” the company says.

Merrill Lynch & Company Inc., New York, is the sole book-running manager of the offering.