SEGRO plc has arranged a private placement of €450 mln 12, 15 and 20 year senior unsecured notes with a group of institutional investors, the firm announced.
The issue consists of three tranches: €150 million at a fixed coupon of 1.35 per cent due 2032, €50 mln at a fixed coupon of 1.45% due in 2035 and €250 mln at a fixed coupon of 1.83% due in 2040. This translates to a weighted average coupon of 1.63% and a weighted average maturity of 16.8 years.
In addition, Segro gave notice to holders of the 6.75% sterling bonds due in 2021 and the 7% Sterling bonds due in 2022 that it intends to redeem in full the outstanding amounts. The combined nominal value of the bonds was £118 mln, and they will be redeemed for £131 mln during August and September.
Pro forma for the position as at 30 June 2020, and taking into account associated hedging, the impact of these transactions is to extend Segro’s average debt maturity to 10.7 years and reduce the average cost of gross debt to 1.6 per cent - including joint ventures at share, excluding commitment fees and amortised costs.
The net proceeds from the new US Private Placement issue, after redeeming the Bonds, will be used for general corporate purposes and the Notes will rank pari passu with SEGRO’s existing unsecured bank, bond and US private placement debt.
Soumen Das, chief financial officer of Segro, said: 'The support we have received from our existing and new investors for our third US private placement debt issue is a further endorsement of the strategy we are pursuing at Segro, reflected particularly in the long duration and low coupons of the new notes.
'It will increase Segro’s weighted average debt maturity and further improve the natural currency hedge for our euro-denominated assets.'
