Secured Bond issue closes oversubscribed
17 June 2008
South Canterbury Finance’s Secured Bond issue closes oversubscribed, raising $125 million
Strong support from across the investment sector has resulted in South Canterbury Finance Limited’s $125 million offer of Secured Bonds, including $50 million of oversubscriptions, closing fully subscribed.
The interest rate for the Secured Bonds (which is fixed for a three-year term) was set on Monday 16 June 2008 at 10.50%. The Secured Bonds have been rated BBB- by Standard & Poor's which is consistent with South Canterbury Finance's rating of BBB-/Stable.
The wide ranging support for the offer is a tremendous vote of confidence in South Canterbury Finance, Chief Executive Lachie McLeod says.
”We particularly wish to acknowledge Forsyth Barr, the Lead Manager and Organising Participant, as well as our network of intermediaries and financial advisers, in achieving this outcome.”
“The strength of South Canterbury Finance and its long-standing and successful history in the finance sector has been recognised by institutional investors, private banks, and the clients of NZX Firms and other financial intermediaries,” Mr McLeod says.
The Secured Bond issue further diversifies the Company’s funding base and follows its 2007 $125 million five-year bond issue and US$100 million private placement in the United States. Together, these three offers have raised approximately $375 million and demonstrated South Canterbury Finance’s ability to successfully raise capital notwithstanding the recent volatility in financial markets.
“Diversification delivers added protection for all our investors, including debenture holders, bond holders, institutional investors and bankers, and safeguards the Company against any potential vagaries that may affect any one particular funding channel,” says Graeme Brown, South Canterbury Finance’s Chief Financial Officer.
“We are delighted with the wide range of support from institutional investors and private investors in the latest three year bond offer. We were also encouraged last year by our ability to attract international institutional investors through our US private placement joining a select number of New Zealand companies such as Fonterra, Contact Energy and Fletcher Building to successfully access this market.”
“The Company is pleased that, in addition to the strong demand for the Secured Bonds, there is continued and steady inflow of new debenture funds.”
South Canterbury Finance’s three year secured bonds will be quoted on the NZDX on Wednesday 18 June 2008 under the ticker code “SCF020”.