MARAC Secured Bond offer closes oversubscribed
MARAC Secured Bond offer closes oversubscribed in challenging market conditions
23 July 2008
MARAC Finance Limited (“MARAC”) is pleased to confirm that following strong support from brokers, financial advisers and retail investors, its inaugural offer of first ranking* secured bonds (“Secured Bonds”) has closed oversubscribed, raising $104.185 million.
The five-year fixed interest rate for the Secured Bonds was set on Monday 21, July at 10.50%.
MARAC’s Managing Director Brian Jolliffe is delighted with the support for the Offer, especially in the current market.
“The oversubscription of our Secured Bond offer is an endorsement of the quality of MARAC. The broader market conditions during the offer period were not favourable, with weakness in equity markets in New Zealand and overseas, further deterioration in the New Zealand economy and some non diversified property lending companies becoming distressed. Given these circumstances we see raising more than our $100 million target through the Secured Bond as being a strong vote of confidence in MARAC’s business.
“Proceeds raised by the Secured Bond offer will further enhance MARAC’s already healthy liquidity reserves, bringing total liquidity to over $250 million today.”
The completion of the Secured Bond issue further broadens MARAC’s funding base, which already consists of committed bank facilities from five major banks, the retail debenture programme and a securitisation programme.
Jolliffe added that “MARAC has an intimate understanding of asset finance with a focus on quality. Investors recognise this quality which is reflected by the success of the Secured Bond and their ongoing support of our debenture programme.
“MARAC lends to thousands of small to medium sized New Zealand businesses that form the backbone of our country’s economy and the proceeds from this offer will assist MARAC to keep servicing this wide range of customers.
“We would like to acknowledge Joint Lead Managers to the offer, Forsyth Barr Limited (“Forsyth Barr”) and ANZ National Bank Limited, and Forsyth Barr as Arranger and Organising Participant. We would also like to recognise our network of intermediaries and financial advisors in achieving this outcome,” Jolliffe concluded.
The Secured Bonds have been rated BBB- (Stable) by Standard & Poor's, which is consistent with MARAC’s rating of BBB- (Stable), and is a rating that is recognised by the international investment community as ‘investment grade’.
MARAC’s five-year Secured Bonds will be quoted on the NZDX on the 24th of July under the ticker code “MAR010”.