Noteholders can retain some or all of their notes on the new terms or have them paid out.

Fonterra has cut the interest rate on its NZDX-listed perpetual capital notes to 4.83% from 8.74% to reflect the lower official cash rate.

The dairy co-operative has $35.1 million worth of perpetual capital notes on issue.

The decrease is based on an almost 4.00% fall in the one year government stock rate since July last year, Fonterra said today, adding that the margin portion of the interest rate remains unchanged at 1.80%.

Eftpos company ProvencoCadmus (PVO) has dropped a bombshell on its capital note holders – offering just 2% interest for a 12-month period from the upcoming rollover date of March 31.

The company said in a statement to the NZX last night that its current level of debt remains a major concern, while it focuses on a recapitalisation programme, including asset sales.

Business may be challenging for Fletcher Building at the moment but investors have given a strong vote of confidence by taking up $100 million of capital notes ahead of schedule.

The company announced yesterday it has raised $100 million via a sale of capital notes, which is still open.
The company's finance unit can sell $100 million more of the notes as over subscriptions.
Phil King, head of investor relations told NBR he was very happy at how the issue went, especially in trying economic times that make any capital raising initiative extremely difficult.

Anyone searching for further clues as to the severity of the financial crisis need look no further than Fletcher Building’s $200 million capital note offer.

In the investment statement for the capital notes, Fletcher Building reveals just how difficult the next two years will be.