The impact of low global interest rates on corporate funding needs is well demonstrated in the announcement by Fletcher Building of the rollover terms on $75 million of capital notes that mature on March 15.
The long-dated corporate bonds are currently paying 8.9 percent annually, but the rate on offer at rollover until March 15, 2019, is 3.5 percentage points lower, at 5.4 percent a year.
Noteholders can retain some or all of their notes on the new terms or have them paid out. Fletcher Building is exercising the option to pay cash rather than convert the notes to ordinary shares in the company.
Noteholders have until February 26 to make their election.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Vodafone promises 'all the free mobile data your household needs' if landline broadband goes down
- Wynyard ‘sad’ and ‘disappointing’
- New board members bring top skills to Local Government Excellence Programme
- What can we learn from Wynyard’s voluntary administration?
- MARKET CLOSE: NZ shares rise as Air NZ, Fletcher, Chorus bounce
Most listened to
- Wynyard: Shareholders Association John Hawkins - shareholders learning a pretty hard lesson
- Lance Wiggs on who's to blame for the Wynyard collapse
- Century 21 boss pleads for a pause on more mortgage lending restrictions
- ‘Idea private sector would provide decent, affordable housing a myth from colonial period on’ – Big Smoke author Ben Schrader
- BNZ's Jason Wong says the consistent message from the US Fed about a likely December cut is pushing the USD up