LONDON (Alliance News) - F&C UK Real Estate Investments Ltd on Tuesday said it has executed a conditional GBP90.0 million 11-year non-amortising term-loan facility agreement with Canada Life Investments and a GBP20 million five-year revolving credit facility agreement with Barclays Bank, in a move to refinance its existing facilities with Lloyds Bank PLC.
The new facilities allow the investment company to draw down up to GBP110.0 million to finance the repayment of the GBP102.0 million term-loan facility provided by Lloyds Bank, which was due for repayment in January 2017.
The company does not have to pay any penalty for repaying the facility with Lloyds Bank, although it will incur costs to terminate interest-rate hedging arrangements in connection with the facility. That means F&C UK Real Estate Investments is to be liable for the cost of breaking the relevant interest rate swap which was accounted for as a liability, net of accrued interest of GBP5.7 million at the end of September.
"No further swap is required given the fixed nature of the principal loan," the company said.
F&C UK Real Estate Investments confirmed that it has fixed the interest rate that will be payable over the term of the loan with Canada Life Investments at the all-in rate of 3.36% per annum (including the yield on the relevant UK gilt) and the interest rate that will be payable in respect of the revolving credit facility with Barclays Bank at the rate of 1.45 percentage points per annum over the three-month London interbank offered rate.
The company plans for the debt to be drawn down on or around November 13.
Shares in F&C UK Real Estate Investments were up 1.0% at 101.28 pence on Tuesday morning.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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