Listed industrial property specialist SEGRO has raised €650 million through a private placement of senior unsecured notes with 13 US institutional investors.
Fresh capital will be used to refinance the 2018 sterling bonds and secured debt within the Airport Property Partnership.
The issue consists of three tranches: €400 million at a fixed coupon of 1.77 percent which is due in 2027, €150 million at a fixed coupon of 2 percent due two years later, and €100 million at a fixed coupon of 2.27 percent, which matures in 2032.
This translates to a weighted average coupon of 1.9 percent and a weighted average maturity of 11.2 years.
The new issue will rank pari passu with SEGRO’s existing unsecured bank and bond debt. The firm has signed an agreement with the investors and closing and funding of the transaction is expected in August.
“The support we have received from our investors for our inaugural, and well oversubscribed, US private placement debt issue is a further endorsement of the strategy we are pursuing at SEGRO,” said its CFO Soumen Das.
“It will increase SEGRO’s weighted average debt maturity to eight years and, once drawn, will improve the company’s overall cost of debt. In addition, it broadens the range of SEGRO’s debt providers and creates a greater natural currency hedge for our euro-denominated assets,” he added.
Lloyds Securities and Barclays Bank acted as joint placement agents.