| Wed 7 Sep 2005, 17:14 | | Liberty - R2 billion Subordinated Unsecured Callab |
|
Liberty - R2 billion Subordinated Unsecured Callable Capital Bonds due
12 September 2017
Liberty Group Limited
Incorporated in the Republic of South Africa
Registration number: 1957/002788/06
Alpha code: LGL
Issuer code: LIBU
ISIN code: ZAE000057360
PRESS RELEASE
LIBERTY GROUP LIMITED
R2 billion Subordinated Unsecured Callable Capital Bonds due 12 September 2017
Liberty Group Limited (Liberty Life) today placed R2 billion subordinated
unsecured secondary capital callable bonds due 12 September 2017 and callable by
Liberty on 12 September 2012. The issue, which was more than twice
oversubscribed, qualifies as regulatory capital and forms part of Liberty`s
capital management strategy designed to enhance regulatory capital ratios,
diversify funding sources and reduce the Group`s cost of capital. Approval for
the issue was granted by the Financial Services Board (FSB) in May 2005. Net
proceeds from the issue will be used for working capital.
The new bond (LGL1) was launched at a spread of 120bps over the benchmark R153
bond to yield a fixed semi-annual interest coupon of 8.93%. This is equivalent
to a spread of 86bps over 3 month JIBAR based on current swap rates.
`We are very pleased with the outcome of the bond launched today. Not only is
this Liberty`s debut capital bond issue, but we believe it is the first public
issue in the domestic bond market for the South African life assurance industry.
The issue spread compares very favourably with the new issue spread on similar
rated secondary capital bond issues from South African banks in the domestic
market. The strong investor demand resulted in us issuing the maximum approved
amount of R2 billion in bonds` says Myles Ruck, Liberty`s Chief Executive
Officer.
The bond was placed by Standard Bank Corporate and Investment Banking, JP Morgan
Securities South Africa (Proprietary) Limited and Andisa Capital.
Fitch Ratings, the international rating agency, assigned Liberty Life a National
Insurer Financial Strength Rating of `AA(zaf)` and a National Long-term rating
of `AA-(zaf)` and reaffirmed the ratings in July 2005. The rating Outlook is
Stable.
The issue will be listed on the Bond Exchange of South Africa. Details of the
bond issue are:
* Launch Date: 7 September 2005;
* Settlement Date: 12 September 2005;
* Bond Exchange Code: LGL1;
* Nominal: R2 billion;
* Maturity Date: 12 September 2017;
* Coupon: Fixed at 8.93% and payable semi-annually on 12 March and 12
September of each year until 12 September 2012, thereafter floating at 3-
month JIBAR plus 186bps and payable quarterly on 12 December, 12 March, 12
June and 12 September until the Maturity Date;
* Issuer`s call: 12 September 2012 or any interest payment date thereafter at
the nominal amount. Issuer calls on Tier II bonds are subject to prior
written approval by the FSB;
* Status: Subordinated, unsecured, qualifying capital issue;
* Law: South African;
* Denominations: R1 million;
* Placement Agents: The Standard Bank of South Africa Limited, JP Morgan
Securities South Africa (Proprietary) Limited and Andisa Capital;
* Underwriter: JP Morgan Securities South Africa (Proprietary) Limited and
The Standard Bank of South Africa Limited.
For further information please contact:
Deon de Klerk, Chief Financial Officer, Tel: 011 408 2572; E-mail:
deon.deklerk@liberty.co.za
Stewart Rider, Group Executive, Finance and Investor Relations, Tel: 011 408
3260; E-mail: stewart.rider@liberty.co.za
This announcement is not for release in the United States, Japan, France, Canada
or Australia.
This announcement does not constitute an offer of securities for sale in the
United States. The securities referred to herein have not been and will not be
registered under the US Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements. The company does not intend to offer
the securities for sale in the United States.
There shall not be any offer, solicitation or sale of these securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of such jurisdiction.
Neither this announcement nor any copy hereof may be taken or transmitted into
the United States, Japan, France, Canada or Australia or distributed directly or
indirectly into the United States, Japan, France, Canada or Australia`.
Johannesburg
7 September 2005
Sponsor
Merrill Lynch South African (Pty) Ltd
Date: 07/09/2005 05:04:11 PM
Produced by the JSE SENS Department
