Places for People gets tenders for £155.49 million of 5.09% bonds

By Susanna Moon

Chicago, Nov. 15 – Places for People Homes Ltd. said investors had tendered £155,491,000 of its £380 million 5.09% secured bonds due July 31, 2043 in the offer that ended at noon ET on Nov. 14.

As announced Nov. 6, the issuer was tendering for up to £200 million of the bonds.

If the financing condition is met, Places for People expects to accept all of the tendered notes for purchase with no pro rata scaling, according to a company announcement on Wednesday.

The issuer previously said it plans to issue sterling-denominated fixed-rate unsecured bonds under its £1.5 billion medium-term note program.

The tender is contingent on pricing of the new issue.

Settlement is expected to occur on Nov. 22.

Pricing was scheduled for 6 a.m. ET on Nov. 15 using the 2.75% U.K. Treasury gilt due Sept. 7, 2024 plus 95 basis points.

The issuer previously said it was holding the offer to manage and extend its debt portfolio by refinancing some of the issue with new unsecured bonds in an effort to reach its “medium term objective of rebalancing the portfolio toward 60% unsecured funding, while further diversifying the investor base.”

When the bonds were issued, the Places for People group of companies used the issuer as the finance vehicle to issue bank and capital markets debt for the whole group mainly on a secured basis.

Since then, the issuer’s “treasury and finance strategy has been refined so that the group now borrows on an unsecured basis.”

The company said that the “strategy has been further refined” with the creation of a new vehicle called Places for People Treasury plc, which is a special purpose financial entity set up to incur financial debt, including the issue of bonds, the release noted.

The purchase price will be determined to reflect a yield to maturity equal to the purchase yield, which will be the value of all remaining payments of principal and interest through maturity, discounted to the tender offer settlement date at a discount rate equal to the purchase yield minus accrued interest.

Holders also will receive accrued interest.

Bondholders who subscribe for new bonds in addition to tendering bonds will receive priority for the allocation of the new issue, the release noted.

The minimum denomination of the new bonds is £100,000.

Settlement is expected to occur on Nov. 22.

Lloyds Bank plc (+44 20 7158 1721 or liability.management@lloydsbanking.com) is the dealer manager. Lucid Issuer Services Ltd. (+44 20 7704 0880 or pfp@lucid-is.com) is the tender agent.

Of the total amount of the 5.09% bonds sold, £200 million was issued on July 10, 2003 and another £180 million was issued on Jan. 7, 2009 and consolidated to form a single series with the original issue.

Places for People owns, develops, manages, rents and sells social housing in the United Kingdom. The company is based in London.

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