Lawyers on debt offering confirm popularity of bond
CNS): Local legal firm Walkers have confirmed that the Cayman Islands government’s first ever sovereign bond issue on the international bond markets was “massively over-subscribed”. The lawyers said it attracted considerable investor interest and was reportedly sold out within hours. The subscriptions received totalled in excess of US$1.25 billion. The 5.950% coupon came in a fraction lower than the expected range of 6.000%-6.125%, which Walkers said indicates the level of investor confidence in the Cayman Islands.
“Walkers were proud to act as Cayman Islands counsel to HSBC, underwriter and sole book-runner in the government of the Cayman Islands’ ground breaking US$312 million Rule 144A/Reg S offering of 5.95% Notes due 2019. The notes are to be listed on both the London Stock Exchange and the Cayman Islands Stock Exchange. The deal closed on 24 November 2009,” Walkers explained.
Walkers also said that the firm had advised HSBC as to Cayman Islands’law on the bridge financing facilities provided to the government in October 2009 prior to the issuance. The Walkers team on the note issuance was Philip Paschalides (partner) and Nicola Bashforth (associate) and on the bridge financing Wayne Panton (partner) and Richard Munden (associate).
Category: Business
CNS…I agree with the previous poster, please dig deeper. If the bond was massively oversubscribed then why wasn’t the rate lowered until the subscription matched the amount they were seeking?
This all seems a bit odd to us non-financial people. I know that Rule 144 and Registration S offerings are rules pertaining to the US Securities and Exchange Commission, so it sounds as if the offering is registered under SEC rules, but the press release says the notes are listed on the London Stock Exchange and Cayman Islands Stock Exchange.
I believe that a Form 144A would be an amendment to the original Form 144, so it would be interesting to see if anyone can locate this filing at the SEC website.
http://www.sec.gov/answers/form144.htm
I AM NOT A FINANCIAL PROFESSIONAL, but typically the government taking the loan (bond) gets the money invested right away, but it must repay it in the future (however many years bond it is) and also interest. The terms of when principal and interest must be paid vary with the type of bond.
NOT INVESTMENT ADVICE
CNS…can you answer this for me? Okay so I am reading this and from what I am hearing a bond was issued and investors bought in and it made $1.25 Billion. My question is this…What amount out of that $1.25 Billion does our government see out of it. Did this make money for our government? I am just a little confused. Can you clarify or give further info?
It means it was oversubscribed to the point that there are offers to buy totalling $1.25B. The total offering is still $312M so there will be investors who don’t get in on the offering or only get a portion of what they bid on.
Fees for the listing could easily be in the millions.