Equites Property Fund Limited has successfully listed a new financial instrument on the Johannesburg Stock Exchange (JSE) as part of its R10 billion Domestic Medium Term Note Programme. The listing of this senior unsecured floating rate note, EQT017, was approved Today. The instrument has a nominal value of R200 million at full issue price and is tied to the three-month JIBAR, with an additional margin of 125 basis points. It will mature on November 13, 2026, with interest payments set to commence on November 13, 2023.
In parallel, Growthpoint Properties Limited issued two financial instruments, GRT59G and GRT60G, under their extensive R30 billion Domestic Medium Term Note Programme established on October 25, 2019. These notes were issued at a price of 100% with GRT59G having a nominal value of R350 million and a coupon rate of the 3-month JIBAR plus 150 basis points. GRT60G carries a higher nominal value of R650 million and offers a coupon rate of the 3-month JIBAR plus 190 basis points. Both instruments will start accruing interest from November 13, 2023, with maturity dates set for November 13, 2030, and November 13, 2033, respectively.
These listings provide investors with new opportunities in the South African debt market and reflect the ongoing activity within the country's corporate bond sector. The notes are traded based on price and settled electronically in accordance with JSE rules. Nedbank Corporate and Investment Bank sponsored EQT017 while Absa Corporate and Investment Bank backed Growthpoint's instruments.
In related news, Nationwide Building Society has issued USD 1.5 billion Series 2023-11 Fixed Rate Regulated Covered Bonds due on November 10, 2026. This issuance is part of a Global Covered Bond Programme worth EUR45 billion. The bonds are guaranteed by Nationwide Covered Bonds LLP and are not available for public offering in the U.S., aligning with specific regulatory requirements. Investors can access full details online or through the National Storage Mechanism.
InvestingPro Insights
Growthpoint Properties Limited, the issuer of GRT59G and GRT60G, has been a prominent player in the Diversified REITs industry, according to InvestingPro. Despite a recent decline in its share price, the company's valuation implies a strong free cash flow yield. This is a key indicator of financial stability and the company's ability to generate cash, which is crucial for meeting its debt obligations, including those related to the newly issued notes.
Moreover, Growthpoint has a commendable track record of maintaining dividend payments for 32 consecutive years, making it a potentially attractive investment for income-focused investors. However, potential investors should note that the company's short-term obligations currently exceed its liquid assets, which may pose a liquidity risk.
InvestingPro provides numerous additional tips for those interested in exploring the performance and potential of Growthpoint Properties Limited further.
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