E-Malt.com News article: 4341

United Kingdom: British regional brewer and pub company Greene King Plc raised 600 million pounds on Wednesday, 02 March 2005, from selling its first bond backed by pub receivables, the banks managing the sale said. The Greene King bond secured on a portfolio of some 900 pubs partly refinances a 1.05 billion pound ($2.02 billion) bridge loan the brewer of Old Speckled Hen and Abbot Ale beers took out for the acquisition of Laurel pubs in 2004, according to Reuters.

The Suffolk-based brewer already refinanced 450 million pounds of the bridge loan with a syndicated loan in December 2004. Greene King sold 150 million pounds of single-A rated floating rate notes with weighted average life of seven years; 320 million pounds of single-A rated fixed rate notes with weighted average life of 16.8 years; and 130 million pounds of triple-B rated fixed-to-floating rate notes with weighted average life of 15 years.

Final pricing was in line with expectations. "There were about 30 accounts for the single-A paper, and about 40 accounts for the single-B paper," said a syndicate manager working on the deal.

He would not disclose the total order book size or the actual number of investors. Some investors bought both the single-A and triple-B notes.

The final terms of Greene King's single-A notes compared favourably to those in a deal Unique Pub Finance Company Plc, part of Britain's top pubs group Enterprise Inns, sold on Feb. 11. Greene King's single-A rated floating rate notes achieved the same spread -- 38 basis points over Libor -- with a longer maturity of seven years. Unique also sold floating rate single-A paper at a spread of 38 basis points, but those offered investors a weighted average life of just 4.4 years.

Unique raised 563.4 million pounds from its pub-receivable backed bond sale last month.


02 March, 2005