UK REIT Hammerson has announced the launch and pricing of a 10-year £350 mln (€476 mln) bond.
UK REIT Hammerson has announced the launch and pricing of a 10-year £350 mln (€476 mln) bond.
The bond was priced at 173 basis points over the reference gilt and has an annual coupon of 3.5%. The issue was more than two times oversubscribed.
Hammerson subsequently swapped the sterling bond nominal amount and coupon payments for euros, resulting in a net coupon cost of 2.5%.
The new coupon, post swaps, of 2.5% is in line with Hammerson's target financing costs and the proceeds of the issue will be used to boost its liquidity following the closing this week of its €1.8 bn joint venture acquisition of the Project Jewel portfolio of loans in Ireland.
The tenure of 10 years is longer than Hammerson's recent euro bond issues and will extend the weighted average maturity of debt by approximately one year. Following this new issue the group's overall loan to value ratio will remain in line with our previously stated guidelines.
Hammerson is rated Baa1 (stable) by Moodys and A- (stable) by Fitch. BNP Paribas, HSBC, Lloyds Bank, Barclays, MUFJ and Santander Global Banking & Markets acted as joint bookrunners.
Timon Drakesmith, CFO of Hammerson, said: 'This transaction is the first sterling bond issue by Hammerson for almost 10 years and represents a welcome return to a home funding market. We are appreciative of the support shown by our key bond investors and our relationship banks have assisted in swapping the coupon to a low 2.5% level in euros.'
