By Lisa Kerner
Charlotte, N.C., Dec. 2 - Hammerson plc agreed to place two tranches of fixed-rate seven-, 10- and 12-year notes totaling $443 million with nine U.S. institutions in 2014.
The notes are denominated in dollars, British pounds sterling and euros, with the dollar portion being swapped to fixed euro. The weighted average coupon is 3.6%, the weighted average maturity is nine years, and the equivalent nominal value is £277 million.
BofA Merrill Lynch, JPMorgan and Barclays acted as agents.
The company will use the proceeds to partly refinance upcoming bond maturities including its €480 million 4.875% eurobonds due 2015.
By the final drawdown in June, the placement will repay existing floating-rate debt and increase the proportion of the group's fixed-rate debt by about 13%, according to a company news release. At Sept. 30, 72% of the group's debt was fixed.
In addition, the financing will extend the weighted average debt maturity by about 0.4 years. It was 5.9 years at Sept. 30.
Hammerson said the attractiveness of the funding opportunity was enhanced by the ability of the U.S. investors to defer closing, enabling the company to maximize the benefit of low floating rates on its banking facilities.
The placement, Hammerson's debut issuance in this market, further diversifies the group's sources of finance and builds on its strong liquidity position, chief financial officer Timon Drakesmith said in the release.
Hammerson is a real estate investment trust based in London.
| Issuer: | Hammerson plc
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| Issue: | Fixed-rate notes
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| Amount: | $443 million
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| Coupon: | Weighted average of 3.6%
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| Maturities: | Seven, 10 and 12 years for a weighted average of nine years
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| Placement agents: | BofA Merrill Lynch, JPMorgan, Barclays
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| Distribution: | Private placement
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| Settlement: | 2014
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