Lion’s $50M E-bond

Press, 13 March 1985, Page 36

Lion’s $50M E-bond

Lion Breweries, Ltd, has completed agreements to raise SNZSOM by a New Zealand dollar denominated Eurobond issue. The issue was arranged by Bank Gutzwiller, Kurz, Gungener (Overseas). Ltd, in association with Fay, Richwhite and Company, Ltd. It was well supported by leading New Zealand, European and Japanese banks, according to Lion.

Mr P. M. Smith, Lion's general manager, corporate planning and finance, said that the proceeds of the issue would be applied towards the group’s current and future funding requirements.

“The funds were raised to take advantage of the favourable market conditions that exist in Europe at the moment, and the issue was denominated in New Zealand dollars to ensure there

was no foreign exchange risk to Lion,” Mr Smith said.

The issue was arranged in two tranches of JNZ2SM, with the first showing a coupon rate of .15% per cent a year, and a term of four to six years; and the second, a coupon rate of 15% per cent and a term of five to seven years. Mr Peter Hopping, of Fay, Richwhite and Company, said that the SNZSOM borrowed by Lion was the largest amount

raised to date by a New Zealand company on the New Zealand Eurobond market.

“It is anticipated that the strong investor demand for the issue will encourage other New Zealand companies to consider this market as a source of capital,” he said. “It also further establishes the Euro-New Zealand dollar market as an important ingredient in the increasingly sophisticated New Zealand capital markets.

“This sophistication has only recently been made possible through the freeing of the financial markets generally, and New Zealand is now in a situation where virtually all of the financial instruments available overseas are able to be utilised by the major local companies.”