Precinct Properties New Zealand Limited (Precinct) has announced an offer of up to $150 million of subordinated convertible notes (Notes), paying at least 4.8% p.a for four years

The convertible element is a little bit interesting in that it provides potential upside due to the way it is structured.

The Conversion Price is the lesser of:

the Conversion Price Cap of $1.40; and
a 2% discount to the Market Price (referred to below as the discounted approach).



Effectively if the share price is above 1.40 in four years Note holders will benefit.

Issuer:
Precinct Properties New Zealand Limited

Instrument:
Fixed rate, unsecured, subordinated convertible notes

Maturity Date:
27 September 2021 (4-year convertible note)

Issue Rating:
The Notes will not be rated.

Size:
Up to NZ$150 million, with the ability to accept up to a further NZ$50 million in oversubscriptions

Interest Rate:
Minimum 4.80%

The indicative margin range above the 4-year swap rate for the Notes is 2.25% to 2.45% per


The oversubscription of the Heartland Bank offer has confirmed there is a lot of money looking for a home..........