- Amcor $400 million convertible note issue
- Austereo Group float
- Ambri's backdoor listing
- Australian Magnesium Corporation
- Case and New Holland Securitisation
- Southcorp second public MTN issue
- Interstar Millennium Series 2001-1E/ 2001-1C Trust
- CSL $330 million placement
Amcor $400 million convertible note issue
AAR represented Amcor Limited, and its wholly owned New Zealand subsidiary Amcor Investments (New Zealand) Limited, in relation to a $400 million convertible note issue. The capital raising was undertaken to underpin Amcor's participation in a $1.1 billion three-way merger of its European flexible packaging operations with Danisco Flexible and Akerlund & Rausing. A retail offering in Australia and New Zealand, and institutional offerings in Australia, the US and Europe, were involved.
The convertible notes, dubbed PACRS (for Perpetual Amcor Convertible Reset Securities), were issued by Amcor Investments (New Zealand) and guaranteed by Amcor. Combining, in an innovative security, many of the features of income securities and convertible preference shares, the PACRS are subordinated, unsecured debt instruments convertible in certain circumstances into Amcor ordinary shares. Certain key terms, such as the interest rate and the general period between conversion times, are able to be 'reset' at specified intervals, giving both the issuer and investors investment flexibility. The initial interest rate was established on the basis of an institutional bookbuild.
The team advised on many aspects of the note issue, including the structuring of the PACRS, the drafting of the Australian prospectus, and the drafting and negotiation of the trust deed, guarantee, underwriting agreements and ancillary documentation. It also assisted in achieving the listing of the issuer as a debt issuer on the ASX.
The issue was very successful, closing oversubscribed.
The AAR team: Bob Santamaria, Greg Bosmans, Robert Pick, Cathy Heeley, Jane Nosworthy and Amy Larking.
Austereo Group float
AAR advised Merrill Lynch International (Australia) Limited, Macquarie Equity Capital Markets Limited and Credit Suisse First Boston Australia Limited in their capacity as Joint Lead Managers to the float of Austereo Group Limited. Specifically, AAR was involved in negotiating and drafting the IPO Management Agreement and providing advice on securities laws issues.
Austereo Group Limited is Australia's most significant radio broadcaster, operating two national metropolitan networks, as well as having operations in Malaysia, Greece and the UK. The A$354 million transaction, one of the largest and most successful floats this year, involved the selldown of a 45% interest by Village Roadshow Limited through a primary offering of shares in Austereo Group. Both a retail offering in Australia and a global institutional offering were made.
The AAR team: Robert Simkiss and Greg Bosmans.
Ambri's backdoor listing
AAR advised Pacific Dunlop Limited's wholly owned subsidiary Ambri Pty Limited (Ambri) on a proposed backdoor listing which will involve the transfer of Ambri to Optecom Limited (Optecom), an ASX listed company which, until recently, operated a sponsored telephony business. The back-door listing will be accompanied by an underwritten fundraising by Optecom subject to obtaining Optecom shareholder approval.
Ambri intends to use the proceeds of the fundraising to commercialise the patented biosensor technology which it has developed. This technology will be used in analytical devices to be developed by Ambri which will be utilised for medical diagnosis and will have the potential to overcome the need to send blood or other body fluids to a central laboratory for analysis, allowing pathology tests to be processed on the spot in less than 5 minutes.
AAR acted for Ambri on the back-door listing and as solicitors to the offer which will involve the issue by Optecom of five types of securities: ordinary shares, employee options, options to be issued to the underwriter, options to be issued to the non-executive directors and a pro rata issue of bonus options to Optecom shareholders. The ordinary shares, bonus options and employee options are being offered by Optecom under the prospectus lodged with ASIC on 13 July 2001. The ordinary shares and bonus options will be quoted on the ASX. The transaction was complex due to the large number of transactions comprising the back-door listing and the range of securities to be offered by Optecom under the fundraising.
The AAR team was led by Kevin McCann and included Robyn Phillips, Kylie Cooper, Patrice Mowat, Louise Baldwin, Robyn Cahif and Charles Lark.
Australian Magnesium Corporation
AAR acted on the A$1.7 billion capital raising project for the development of a cutting edge magnesium metal plant at Stanwell in Central Queensland. With approximately A$200 million already spent on R&D, the plant will employ some state-of-the-art Australian-developed technology. Upon completion, it is expected to be the largest and among the lowest cost magnesium metal producing plant in the world, and essentially the creation of a new high value export industry for Australia.
Phillip Cornwell led a team, which included David Clifford, Annalisa Aromataris, Nicola McGuire, Michael Rodrigues, Alex Hill, David Robb, Stephanie Beaumont and Roger Loo, advising Australian Magnesium Operations (an Australian Magnesium Corporation subsidiary) on its A$932 million project debt raising. The financing structure developed includes scope for mezzanine institutional debt, leasing and a US Rule 144a high yield issue as well as straight bank debt. Various complicated aspects and existing arrangements had to be factored in and renegotiated in order to suit the needs and risk portfolios of all participants. The team also advised on the contingent equity commitment from AMC's principal shareholder.
Meanwhile, an Erin Feros led team, including Andrew Rankin and Lawrie Ward, advised the joint lead managers, JB Were, Merrill Lynch and ABN AMRO, on the recently withdrawn global A$680 million share offering. We negotiated the terms of the settlement agreement with the company and advised the lead managers on the institutional offering memorandum and the prospectus, the due diligence aspects of the equity raising and on the withdrawal of the offer.
Case and New Holland securitisation
We recently closed a deal involving the setting up of a securitisation programme for Case Credit Australia (indirectly owned by FIAT sPa) and New Holland Credit Australia. The assets securitised were commercial hire purchase agreements and finance leases originated by Case and New Holland, relating to agricultural and construction equipment manufactured under the Case IH and New Holland brands. Asset backed securities to the tune of $450 million were issued to fund the securitisation programme.
The deal will be the first of its kind in the domestic market, and will provide a source of funding cheaper than bank debt or a vanilla bond issue for the group. The structure employed resulted in the asset backed securities gaining a rating higher than the corporate itself. The deal is unique for two reasons: the class of assets being securitised, and the fact that the individual assets were largely operating pieces of equipment tied to third parties' businesses.
The AAR team, consisting of Mark Wormell, Foh Lin Lim and Kenneth Tang, acted for the originator and was responsible for drafting all legal documents for the securitisation programme.
Southcorp second public MTN issue
We acted for Southcorp Finance Limited in its second public debt issue under its recently increased A$750m medium term note (MTN) programme. The A$125m notes, which were issued on 3 August 2001, are guaranteed by Southcorp Limited and managed by joint leads ANZ Investment Bank and Westpac. It is a pure corporate issue as opposed to the majority of recent deals which are asset backed. At 5 years, it provides a good complement to the A$100m 10-year Southcorp notes already in the market.
The programme has been rated BBB+ by Standard & Poors, and it provides a rare opportunity to investors to invest in AUD denominated bonds in the beverage industry.
The AAR team, consisting of David Clifford and Vanessa Ly, advised Southcorp in relation to the issue, drafted the documents and assisted in negotiation with the dealers.
Interstar Millennium Series 2001-1E Trust / Interstar Millennium Series 2001-1C Trust
AAR acted for Interstar Securities (Australia) Pty Ltd on its second offshore issue through its Millennium programme, and it represents its first foray into the US Rule 144A market. This follows its successful debut offshore in the European market last year, which we also acted on.
The issue, which closed on 1 May 2001, involved a uniquely tailored two tier trust structure. This allowed the issuance of US$220m of bullet notes, with maturity of less than one year, aimed at the money markets. The pricing achieved was also cutting edge. In sum, the trustee of the "1E Trust" issued three senior tranches of US$ notes (totalling US$465 million), one of which was the short term bullet money market tranche, and one subordinated tranche of A$ notes (of A$68 million). The notes issued from the 1E Trust were supported by payments under notes issued by trustee of the "1C Trust" that were acquired by the 1E Trust. There were three tranches of A$ notes (totalling A$900.29 million) and one subordinated tranche of A$ notes (of A$68 million) issued out of the 1C Trust.
The team, consisting of Andrew Jinks, Patricia Tsang and Melissa Solomon, advised Interstar in a number of areas, including the documentation of the cashflow and the two tier trust structure, the drafting and negotiation of the documentation establishing the trusts, as well as the drafting, structuring and negotiation of various other documentation.
CSL $330 million placement
AAR represented CSL Limited in relation to a A$330 million placement of ordinary shares. The placement was undertaken to fund CSL's acquisition of 47 US based plasma collection centres and associated laboratory facilities from Nabi, a NASDAQ listed biopharmaceutical company, for a total consideration of US$152 million (A$292 million). The placement was made to institutional investors in Australia, Asia, the US and Europe.
The placement was conducted under a bookbuild process conducted on 26 June 2001 during a 24 hour trading halt in CSL shares on the ASX, with Merrill Lynch the Lead Manager and Bookrunner.
CSL issued 8.25 million new ordinary shares under the placement at a final allocation price of $40.00 to raise a total of A$330 million. The issue was strongly supported by Australian and international investors, particularly by existing shareholders.
The placement corresponded to approximately 5.5% of shares on issue prior to the offering. The final allocation price represented a 2.6% premium to the CSL closing share price of $38.994 on 25 June 2001, immediately prior to the announcement.
At the same time as announcing the Nabi acquisition and placement, CSL announced an earnings upgrade, stating that CSL expected the result for the full year to June 2001 to show a net profit after tax of approximately $76 million, an increase of 40% over the prior year.
The CSL share price after completion of the placement on 27 June 2001 rose as high as $49.90, with CSL shares consistently trading above $47.00 since the placement
The AAR team: Cameron Price and Robert Pick.
