Fonterra has announced its issue of 6 year unsecured senior bonds to raise NZ$300 million will offer at least 7.75% when it opens next Monday. This is around double what banks are offering now for term deposit rates. The A plus rated offer will close on March 6 and Fonterra said it could accept unlimited oversubscriptions. The minimum investment level is NZ$5,000. The interest rate will be finalised on March 9 and will be the higher of 7.75% or the six year swap rate plus a margin of 3.40% on March 9. The joint lead managers are ANZ and BNZ Capital, while the co-managers are ABN Amro Craigs and First NZ Capital. Fonterra Chairman Henry van der Heyden said Fonterra intended to use the money for general business purposes, including working capital. He said the offer gave retail investors the opportunity to earn an attractive yield on a fixed-rate investment backed by New Zealand's largest exporter. * This article was first published yesterday in our daily subscription newsletter for the banking and finance industries. The email costs NZ$365 per annum and carries exclusive news and analysis for New Zealand banking and finance industry executives, regulators and investors. Sign up for a free trial here.
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