Marstons Regulatory News (MARS)

19 Nov 2007 13:18

Marston's PLC19 November 2007 19 November 2007 Marston's PLC Successful Securitisation Issue Marston's PLC ("Marston's", and together with its subsidiaries the "Marston'sGroup" or "the Group") has finalised the terms of a £330m tap issue of Marston'sIssuer PLC (formerly W&DB Issuer PLC) securitisation. This is backed by thetransfer of 437 freehold and long-leasehold tenanted pubs from thenon-securitised estate to the securitised estate. The pro-forma run-rate EBITDAfor the enlarged securitisation group as at 30 June 2007 was £147.3m.Additionally, Marston's will retain £400m of its existing bank facilities.Following the tap issue only approximately £150m will be drawn against thesefacilities, providing the Group with significant financial and operationalflexibility. The terms of the tap issue are announced today and the transaction is expectedto be completed this week. The refinancing delivers significant benefits toMarston's: • highly competitive ongoing cost of funds with a weighted average margin for the tap issue of 0.80% over Libor, resulting in interest cost of the new issuance of 6.03%, including the costs of hedging.• improves the efficiency of the Group's debt funding, replacing short-term bank borrowing with long term securitised financing.• enhanced operational and financial flexibility within the revised debt structure.• all of the Group's debt is now at effective fixed rates of interest, with no refinancing risk or exposure to volatile credit markets. Marston's tap issue is the only pub securitisation, and one of the very fewsecuritisations in Europe, to have been launched successfully and priced inrecent months. Paul Inglett, Group Finance Director, said "Despite adverse market conditions,the terms of the refinancing demonstrate the strength of Marston's creditprofile and the high quality of its pub estate". The securitisation tap issue has been pre-placed. The pricing of the tap issueis in line with previous pub securitisations and is very competitive given thecurrent difficult conditions in the securitisation markets. The securitisationtap issue priced at the following levels: Tranche Rating (S&P/F) Type Maturity Amount Coupon A4 A/A FRN 2031 £250m Libor + 65 bps1AB1 BBB+/BBB+ FRN 2035 £80m Libor + 125 bps1Total £330m Libor + 80 bps2 Note 1: The FRNs are fully hedged and will be issued at a discount to par priceof 99.95%Note 2: This is the weighted average margin to a step-up in coupon at year 5 As a result of the interest rate swaps put in place in October and the £330m tapof the securitisation, all of the Group's borrowings are now effectively atfixed rates of interest with a blended average cost of debt of approximately6.1%. Marston's will be holding a bondholder presentation on Monday 3rd December at9.30am at the offices of Hudson Sandler, 29 Cloth Fair, London, EC1A 7NN. Pleasecontact Vanessa Laybourn at Hudson Sandler on 020 7796 4133 for details. The Royal Bank of Scotland plc acted as the Arranger, Joint Bookrunner and JointLead Manager in the transaction. HSBC Bank plc is a Joint Bookrunner and JointLead Manager and Barclays Capital is a Joint Lead Manager on the transaction. NMRothschild & Sons Limited advised Marston's on its refinancing strategy. Contact details Marston's PLC Ralph Findlay, Chief Executive 01902 329 516Paul Inglett, Group Finance Director 01902 329 516 The Royal Bank of Scotland plc (Arranger and Joint Bookrunner) Colin Lally, Director 020 7085 6668Paul Crawford, Director 020 7085 5165 NM Rothschild & Sons Limited (Financial Adviser to Marston's) Tom Smyth, Managing Director 020 7280 5719Swagata Ganguly, Assistant Director 020 7280 5676 Hudson Sandler (PR Adviser to Marston's) Andrew Hayes 020 7796 4133Nick Lyon 020 7796 4133 This information is provided by RNS The company news service from the London Stock Exchange