LandSec launches tender offer to buy back £450m bonds

By Kasmira Jefford - Wednesday, September 06, 2017 15:07

Landsec has launched a tender offer to buy back up to £450m of bonds and to issue two new sterling-denominated fixed rate notes with expected maturities of 20 and 40 years.

The FTSE 100-listed company has invited holders of three tranches of its bonds - Class A6, Class A7 and Class A11 - to tender their notes for cash as it seeks to bolster its balance sheet by extending the duration of its bonds.

The existing bonds have a combined outstanding balance of £1.14bn and an expected maturity date ranging from 2027 to 2034, with fixed coupons of between 5.125% and 5.396%.

LandSec said it will buy up to £450m of notes, with the offer ending on 14 September, although it has the right to accept less than or more than such amount for purchase pursuant to the offers. 

It has also announced plans to issue new sterling-denominated fixed rate notes in either one or two tranches. noteholder that want to subscribe for new notes will be given priority in the allocation, subject to the completion of the relevant offer and new notes.

The latest offer comes after LandSec bought back £635m of bonds at a cash cost of £759.1m in February. 

"The aim of these transactions is to term out part of Landsec's short term borrowings and use that opportunity to extend the duration of some of its corporate bonds," the company said. 

Landsec is separately to receive £634.5m in net proceeds from its recent sale of its 50% stake in the Walkie Talkie tower and intends to return around £475m to shareholders in the form of a payment of 60p per share, which would be accompanied by a share consolidation.

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