Rates round-up
Fortress notes worthless; Credit event for Credit Sails; Rabobank contemplating PIEs; Geneva forks out third repayment; Contact raises $550m
Monday, April 6th 2009, 5:02AM
Fortress notes worthless
Macquarie fortress Investments has said its NZX-listed Fortress Notes are worthless.
The company says the deterioration in global financial markets has continued to affect the traded prices of US Senior Secured Loans in the Fortress portfolio. Currently, the cumulative market value of senior loans in the Fortress portfolio is below the total debt facility balance.
Macquarie says even in the event there is ultimately a shortfall between the total debt facility balance and the cumulative realised value of senior loans, noteholders will not be required to fund the shortfall.
The refinancing arrangement, which was concluded in April 2008, is committed for eight years until 2016 and does not incorporate any market value based repayment triggers.
The final return to investors continues to depend on default and recovery rates of senior loans in the Fortress portfolio.
Credit event for Credit Sails
The Credit Sails fund has suffered another “credit event.” It told the NZX last week that one of its investments, Idearc Inc, filled for Chapter 11 protection.
Idearc is part of the Momentum Series 2006-16 collateral notes, which comprise the collateral for the Credit SaILS.
“This credit event will cause further reduction of the principal amount of the Momentum collateral notes,” the company says. “Any reduction of principal of the Momentum collateral notes will cause a shortfall of available funds necessary for Credit Sail to repay the principal of the Credit SaILS at maturity.
Rabobank contemplating PIEs
Rabo Capital Securities, a wholly-owned subsidiary of Rabobank, is considering making an offer of PIE capital securities to the public.
If issued, the securities would constitute Tier 1 Capital for Rabobank.
Geneva forks out third repayment
Geneva Finance has repaid investors a further 15% of principal, plus interest.
The company has now returned 40% ($38.2 million) of investors’ funds, plus interest during the past 11 months.
Contact raises $550m
Contact Energy has raised $550 million through its five-year fixed rate bond offer, after receiving applications well in excess of the original $300 million sought.
Contact intends to use the capital raised to support its capital investment program.
The fixed rate bonds mature in May 2014 and offer investors a rate of 8% interest.
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