Swiss Re is to raise the $2bn (£1.5bn) it needs to buy Lincoln Re through a combined equity and convertible bond offering.
It will use extra money raised on top of the purchase price to write new business.
The reinsurer announced on Monday (October 22) it would offer shareholders one share for every ten shares already owned at market value. Shares not taken up in the rights offering will be made available in a global share offering.
There will be a concurrent offering of convertible bonds.
The subscription period for the rights offering will start on October 31, with subscriptions due by November 12. The bookbuilding period for the global and convertible offerings will start as soon as the subscription period closes.
A company statement said the offering would also be used for "general corporate purposes". A spokesman would not reveal what these purposes were, nor the total amount Swiss Re hoped to raise through the offering.
However, an analyst close to the company said Swiss Re would use the money to write new business.
"We're heading into the hardest markets the world has ever seen, supply is being squeezed and having capital is a good thing," he said. "It's not a question of needing the capital, it's a question of wanting it."