Australia’s FIIG Plans Third Bond Deal With G8 Education NotesBenjamin Purvis
FIIG Securities Ltd., an Australian fixed-income specialist, is arranging its third bond with at least A$30 million ($28 million) of notes offered by G8 Education Ltd.
The six-year senior unsecured securities, which are unrated, will be issued by the end of August, according to a regulatory filing from G8 Education, a provider of child-care services. FIIG has previously managed offerings for Silver Chef Ltd., which provides rental finance for food service equipment, and unlisted Mackay Sugar. Its transactions to date have been unrated, according to Andrew Gordon, the arranger’s director of fixed-income origination.
The earlier transactions have “encouraged many other companies to consider a wholesale bond issue to professional and sophisticated investors who include high-net worth individuals and self-managed superannuation funds,” Gordon said in a telephone interview. “This is something of a unique funding channel for borrowers in Australia.”
Silver Chef sold A$30 million of five-year notes in September 2012, while Queensland-based Mackay Sugar priced A$50 million of five-year bonds in March this year.
The proposed G8 Education deal comes amid renewed signs of activity in Australian corporate bond issuance. Perth Airport Pty yesterday priced A$150 million of notes in the first sale of bonds by a non-financial company since comments last month by Federal Reserve Chairman Ben S. Bernanke about the possible tapering of stimulus measures roiled global markets.
G8 Education plans to discuss the transaction with investors next week, said Gordon, who declined to give price indications. The child care company, based on Queensland’s Gold Coast, expects earnings before interest and tax exceeding A$17.1 million for the six months ended June 30, 2013, it said in a separate statement today.
“The proceeds of the note offering will only be used to fund future acquisitions that meet the company’s acquisition metrics,” G8 Managing Director Chris Scott said in the bond transaction announcement today. “This offering is in line with G8 Education’s diligent approach to capital management.”
The company last month announced that it had agreed to acquire 17 childcare and education centers for as much as A$24 million and that it would boost its dividend to 12 cents per share, a 20 percent increase.