Segro Regulatory News (SGRO)

SEGRO plc (the Company)

LEI: 213800XC35KGM9NFC641

5 October 2017

STERLING BOND TENDER AND NEW ISSUE

Further to the announcement of 25 September 2017, SEGRO plc ("SEGRO" / the "Group") announces the successful execution of the tender offer, subject to final documentation, for certain of its existing bonds and the launch and pricing of two new longer dated bonds. 

SEGRO confirms it has launched and priced a £350 million bond with a maturity of 12 years paying a coupon of 2.375% and a £400 million bond with a maturity of 20 years paying a coupon of 2.875%.

SEGRO also confirms that is has accepted for purchase in cash an aggregate principal amount of existing Sterling bonds across four tranches equal to £550 million at a cash cost of £677 million. The final results of this tender offer were contained in the release issued to the London Stock Exchange on 4 October 2017.

Based on SEGRO's reported debt position and valuation at 30 June 2017, the pro-forma impact of the tender offer and new issuance on the Group's financial metrics is as follows:

· The weighted average maturity of debt increases by 3.0 years to 10.8 years

· The annual interest saving is circa £10 million equating to a 0.5% reduction in the cost of debt

· The loan-to-value increases by 1% to 30%

· EPRA net assets will be circa £127 million lower

The proforma effects shown above are based on completion of the transaction due on 11 October 2017 and the closing out of derivative positions associated with the existing bonds which will be undertaken shortly.

Soumen Das, SEGRO's Chief Financial Officer, commented: 

"We are delighted with the support we have received from our long-term sterling bond investors on both the tender and the highly over-subscribed new issue. The success of this transaction is a further endorsement of SEGRO's strategy, and allows us to strengthen our balance sheet by extending our debt maturity and reducing our average cost of debt."

Banco Santander, S.A., HSBC Bank plc and Lloyds Bank plc acted as Dealer Managers on the Tender Offer, with The Royal Bank of Scotland plc (trading as NatWest Markets) acting as Co-Dealer Manager. Banco Santander, S.A., HSBC Bank plc, Lloyds Bank plc and The Royal Bank of Scotland plc (trading as NatWest Markets) acted as joint bookrunners on the New Issues, with Wells Fargo Securities International Limited acting as Senior Co Manager and Bank of China Limited, London Branch and KBC Bank NV acting as Co Managers.

About SEGRO

SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, manager and developer of modern warehouses and light industrial property. It owns or manages 6.3 million square metres (68 million square feet) of space valued at over £8 billion, serving customers from a wide range of industry sectors. Its properties are located in and around major cities and at key transportation hubs in the UK and in nine other European countries.