The Jockey Club, the largest commercial group in British horseracing, is marketing a debut bond to individual investors to help fund development at its Cheltenham racecourse.
The Jockey Club, which was founded in 1750, wants to raise at least 15 million pounds ($22.9 million) from the offer of five-year securities, according to a statement from the London-based company. As well as a coupon of 4.75 percent, the notes will pay 3 percent a year in interest that can be used for tickets, food and drink at the company’s 15 racecourses in the U.K., including Aintree, Newmarket and Cheltenham.
Sales of retail notes listed on the London Stock Exchange jumped to a record 1.5 billion pounds last year compared with 230 million pounds in 2010, when the bourse started its bond platform for individual investors, exchange data show. Sterling-denominated company debt handed investors 2.3 percent this year, outpacing 0.3 percent returns from euro bonds, according to Bank of America Merrill Lynch data.
“Our racecourse bond offers you generous cash returns at a time of rock-bottom interest rates,” Paul Fisher, group managing director of Jockey Club Racecourses said in the statement. “The money we raise from The Jockey Club Racecourse Bond will go straight into British racing through the iconic 45 million-pound development we are planning at Cheltenham Racecourse.”
Companies raised 340 million pounds from retail bond sales so far this year, according to the LSE.
The Jockey Club’s bonds won’t be listed and there will be a minimum investment of 2,000 pounds and a maximum of 100,000 pounds, it said. The notes will be marketed until about May 17.