Willis Group has strengthened its balance sheet by redeeming all its issued and outstanding preference shares for $273m (£193m).

The move is thought to make the world's third largest insurance broker savings worth an estimated $23m (£16.2m) in interest payments every year.

Preference shares carry no voting rights but have a fixed dividend payment.

They have priority over ordinary shareholders and were first issued when Willis was bought by Kohlberg Kravis Roberts (KKR) in 1998.

Willis's decision to redeem follows its placing of 20 million shares on the New York Stock Exchange last month. A further block of 3 million shares were also introduced to the market on the same day, as the placing was oversubscribed.

At the time, Willis said it was selling its common stock shares to pay back some of its $935m (£661m) long-term debt. It stated that one of its options was to use the sale proceeds to redeem the preference shares.

Chairman and chief executive Joseph Plumeri said: “We intend to either redeem some of the preference shares in TAII, a Willis group subsidiary, or to repay debt from Willis North America, or a combination of both.”

The global insurer, which provides specialised risk management advisory and insurance to construction, aerospace, marine and energy industries, originally forecast sale proceeds to be $270m (£191m).

Shares began trading at $13.50 (£9.50), but are currently selling at around 30% higher. Company records reveal Willis had long-term debt as of March 31.