AX Investments plc - Details of New Bond Issue

On 5 February 2014, AX Investments plc published a Prospectus dated 3 February 2014 in connection with a new €40 million bond issue. AX Investments plc is offering a guaranteed allocation to holders of the 6.7% AX bonds which are going to be redeemed early on 15 December 2014 (“Maturing Bonds”). The salient details of the new Bond issue are as follows:

Coupon:

6.0%

Amount Offered:

€40 million

Issue Price:

100% (par)

Interest Payment Date:

Annually on 6 March (first interest payment date is 6 March 2015)

Maturity:

The bonds will mature at 100% (par) on 6 March 2024.

Status:

The Bonds constitute the general, direct, unconditional and unsecured obligations of the Issuer. The Bonds will also be guaranteed by AX Holdings Ltd. As such, the Bonds shall at all times rank without any priority or preference among themselves and with other unsecured debt of each of the Issuer and Guarantor.

As at 31 December 2013, the AX Group had €28.2 million out of its total borrowings of €45.7 million (comprising bank borrowings, bank overdrafts and outstanding bonds amongst others) secured by privileges and hypothecs against the Group’s assets. Therefore, such secured debt ranks ahead of any unsecured debt including the new bond issue.

Use of Proceeds:

The net proceeds from the bond issue, estimated at €39.3 million after issuance costs, will be principally used by the Issuer as follows:

i)    to finance the redemption of the outstanding €11.6 million 6.7% bonds;

ii)   to on-lend €21 million to Simblija Developments Ltd (a wholly-owned subsidiary of AX Holdings Ltd) for the purpose of constructing the Hilltop Gardens Care Home & Residences (the balance of €1 million required for the cost of construction will be funded by own funds of Simblija Developments Limited);

iii)   to finance the Group’s general corporate requirements including the early repayment of certain outstanding loans.

Deadline & Minimum Application for Holders of Maturing Bonds:

Thursday 20 February 2014 – Minimum Application: €1,000 and in multiples of €100 thereafter

Deadline & Minimum Application for Pre-placement:

Thursday 20 February 2014 – Minimum Application: €10,000 and in multiples of €100 thereafter.

Issue Period & Minimum Application for General Public:

Monday 24 February to Friday 28 February – Minimum Application: €1,000 and in multiples of €100 thereafter.

The offer may be closed early in the event of over subscription

Listing:

Official List of the Malta Stock Exchange

Disclaimer:

The value of investments may increase as well as decrease and past performance is not an indication of future performance. Prospective investors are urged to read the Prospectus including the Risk Factors contained in section 2 of the Registration Document and Securities Note. Prospective investors are urged to consult an independent financial adviser for advice prior to investing in the Bonds.

Downloads:

AX Investments plc – Company Profile

AX Investments plc – Corporate Video

AX Investments plc – Prospectus dated 3 February 2014

AX Investments plc – Authorisation To Apply Form

 

Should you be interested in obtaining a copy of our research note including our recommendation kindly send us an email on info@rizzofarrugia.com

 

This webpage has been prepared based on the Prospectus issued by AX Investments plc dated 3 February 2014, and no representations or guarantees are made by Rizzo, Farrugia & Co. (Stockbrokers) Ltd with regard to the accuracy of the data. This webpage is for information purposes only. It is not intended to be and should not be construed as an offer or solicitation to acquire or dispose of any of the securities or issues mentioned herein. Rizzo, Farrugia & Co. (Stockbrokers) Ltd accepts no responsibility or liability whatsoever for any expense, loss or damages arising out of, or in any way connected with, the use of all or any part of this webpage.