Consistent dividend payer WHSP prices A$225 million notes offering

  • January 22, 2021 06:29 PM AEDT
  • Hina Chowdhary
    Director, Equities Research Hina Chowdhary
    1706 Posts

    Hina Chowdhary is the Director, Equity Research at Kalkine and has an extensive experience of about 15 years in the area of Research, which includes 5+ years in Equities Research particularly.She has earned a Master of Science degree from the renowne...

Consistent dividend payer WHSP prices A$225 million notes offering

Summary

  • Investment house WHSP is one of the oldest businesses listed in Australia. For investors, the firm has been a record compounder of wealth and a consistent dividend payer. 
  • It seeks to refinance financial debt at lower rates with the pricing of convertible notes worth $225 million.
Gold MTF non-AMP

Washington H. Soul Pattinson and Company Limited (ASX:SOL) shares fell over 4% on Friday. The investment company had priced an offering of $225 million senior unsecured convertible notes due 2026. 

As an investment house, WHSP holds stakes in Australian public listed as well as private companies. It has increased dividend payments in the last twenty years since 2001. In 2001, the investment firm returned 11 cents per share in dividends, which was 60 cents per share in 2020.

Source © Kalkine Group 2021

As of 30 November 2020, telecommunications constituted 34.8% of its portfolio. Some its largest holdings comprise TPG Telecom (ASX:TPG), Tuas (ASX:TUA), Brickworks (ASX:BKW), New Hope (ASX:NHC), Australian Pharmaceuticals Industries (ASX:API), Palla Pharma (ASX:PAL), Malaysia listed Apex Healthcare.

Earlier on Thursday, the company launched a convertible bond issue. The notes carry 0.625% per annum coupon payments, with a 25% conversion premium. Upon conversion, the $225 million will be converted into SOL shares at an initial conversion price of $34.99 per share, subject to adjustments. 

Source: SOL AGM Presentation, 9 December 2020

WHSP intends to repay $200 million of the existing debt. The new notes extend the debt maturity profile of the company while also lowering debt servicing payments. 

After commissions and fees, the net proceeds will be around $221 million. The raising will also boost the liquidity position of the investment firm. 

With the debt offering, WHSP also completed Delta Placement at a clearing price of $27.99, indicating a discount of 3.5% on the closing price of 21 January. 

SOL shares ended 4.92% lower at $ on Friday, 22 January 2021.

 

 


Disclaimer
The website https://kalkinemedia.com/au is a service of Kalkine Media Pty. Ltd. (Kalkine Media) A.C.N. 629 651 672. The principal purpose of the content on this website is to provide factual information only and does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. In providing you with the content on this website, we have not considered your objectives, financial situation or needs. You should make your own enquiries and obtain your own independent advice prior to making any financial decisions.
Some of the images that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed on this website unless stated otherwise. The images that may be used on this website are taken from various sources on the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image. The information provided on the website is in good faith, however Kalkine Media does not make any representation or warranty regarding the content, accuracy, or use of the content on the website.

 

   
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK