Industrial property investor/developer SEGRO, as venture adviser to the SEGRO European Logistics Partnership (SELP), has launched a bond issue and agreed a new credit facility in order to refinance existing debt.
The firm has launched a €500 million unsecured bond issue for SELP and has also agreed in principle a €200 million revolving credit facility with BNP Paribas and Royal Bank of Scotland (RBS).
The seven-year bonds are priced at 120 basis points over the euro mid swap rate and have an annual coupon of 1.25 percent. The firm said that the proceeds of the issue will principally be used to prepay the majority of SELP’s secured bank facilities.
SELP was formed in October 2013 and, at 30 June 2016, had a gross asset value of €2.25 billion. The company is a joint venture between SEGRO and Canadian pension fund Public Sector Pension Investment Board.
The joint venture has a long-term debt rating of Baa2 (stable outlook) by Moody’s and BBB+ (stable outlook) by Fitch and the bonds are expected to be rated in line with these. BNP Paribas, Morgan Stanley and RBS acted as joint lead managers on the transaction.
The refinancing is expected to reduce the all-in cost of third party financing in SELP by approximately 110 bps from 2.7 percent currently.
“We are very pleased by the depth and breadth of support for this inaugural SELP bond issue which is testament to the high quality assets and cash flows of the joint venture. The issue allows SELP to finance itself both at a lower cost and more efficiently,” said Justin Read, group finance director of SEGRO.
If you do not receive this within five minutes, please try to sign in again. If the problem persists, please email: