SUM - Summerset Group

[winner69]

Bonds?

https://nzx.com/companies/SUM/announcements/301909

http://summerset.co.nz/bondoffer/index.html

Best Wishes
Paper Tiger

Last August they touted the increased bank facility of $450m to cover future build

But if SUM offer bonds it must be a good thing

[winner69]

hmm bit confusing as I thought they could have easily gone to the banks for cash?

The banks not wanting to lend anymore (for now) to the highest leverage village maybe so going to the market for debt?

Likely have the above completely wrong

Maybe positioning themselves for a takeover of Arvida

Had to say that t_j

[couta1]

Bond issue makes very good sense to me.
Gives them another funding avenue other than banks.
Six years is a good time frame.

A first for the retirement sector in NZ, but hey why not be different, I reckon these bonds will be quite desirable.

[trader_jackson]

Last August they touted the increased bank facility of $450m to cover future build

But if SUM offer bonds it must be a good thing

SUMthing doesn't quite sound right... I thought, given SUM's great track record of underlying NPAT growth (which can only ever continue, right?) banks would be bending over backwards to throw cash at this "safe as houses" investment, that is Summerset? (as they do boast every now and then how fantastic their debt facilities are...)
Now they seem to have gone cold on the idea... wonder what changed their mind?

winner69 you could be onto something... maybe they need it for the $2.50 takeover offer for that old dog that listed late 2014 at 95 cents?

[couta1]

Last August they touted the increased bank facility of $450m to cover future build

But if SUM offer bonds it must be a good thing

No mate, their bank facility now stands at $600m.

[couta1]

SUMthing doesn't quite sound right... I thought, given SUM's great track record of underlying NPAT growth banks would only be to happy to throw cash at SUM? (as mentioned last August)
Now they seem to have gone cold on the idea... wonder what changed their mind?

Your continual knocking of the stock is growing weariSUM, how about giving that ARV thread a good old ramp aye.

[winner69]

No mate, their bank facility now stands at $600m.

Thats right ... increased from to $600m

My bad

[trader_jackson]

Your continual knocking of the stock is growing weariSUM, how about giving that ARV thread a good old ramp aye.

I prefer to ask objective questions, or make objective statements (most of the time ), rather than ramp up a stock, particularly if that ramp is based on (likely) flawed "alternative facts" (ie opinions presented as facts)

[trader_jackson]

C'mon tj - you getting a bit emotional. Your hate for SUM (and love of ARV) makes you sound like an unreasonable person
Even Arvida had this as one of the main risks for investing in them

Property market risk: The Arvida Group’s future financial performance will be impacted by any decline in the property*market conditions or valuation methodologies etc etc:

Never said Arvida didn't have this risk... (although others on here have said this isn't a risk?)
ARV just has ALOT less debt (as a %)... I know it, we know it, everybody knows it folks

[Beagle]

Very smart move by SUM. Julian Cook obviously using his investment banking background to diversify the funding base and locking in further funding for strong ongoing growth at close to 50 year interest rate lows. This together with the recently expanded $600m bank facility will provide a LOT OF HEADROOM for opportunities for land banking purchases at low prices if the market turns down.
The irony is this opportunity will probably appeal a lot to existing residents.