Kiwi Income Property to price NZ$125 million five-year mandatory convertibles to yield 8.95%

By Rebecca Melvin

New York, Nov. 10 - Kiwi Income Property Trust plans to price up to NZ$125 million of unsecured subordinated mandatory convertible notes, with NZ$100 million to be available to New Zealand residents and Australian institutions, and the entitlement offer of NZ$25 million to unit holders in the trust with a registered address in New Zealand.

The five-year mandatories will pay a fixed interest rate for five years of 8.95% per year and will be convertible at NZ$1.20 per trust unit.

The offers will extend the duration of the trust's funding base, diversify sources of funding and provide flexibility for the trust to consider additional investments.

Investors will get units to a minimum value of NZ$1.02 for every NZ$1 initially invested and the opportunity to benefit in the appreciation of the unit price above NZ$1.20.

Goldman Sachs JBWere (NZ) Ltd. is joint lead manager and arranger, and Craigs Investment Partners Ltd. and Forsyth Barr Ltd. are joint lead managers.

The closing date for the primary offer is Dec. 11.

The mandatories are expected to be listed on the New Zealand stock exchange.

Auckland-based Kiwi Income Property Trust is New Zealand's largest diversified property trust.

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