Grŵp Cynefin has confirmed a debut 30-year secured private placement of £50m as funding to reduce market risk.
Backed by Centrus, the placement is with BAPFIM (BAE Systems Pension Funds Investment Management Limited) and will be drawn over three different tranches – the final of which is deferred to July 2021.
Grŵp Cynefin operates across North Wales and north Powys, managing 3,900 properties.
The placement – and its highly competitive interest rate – is said to offer an “attractive source” of long-dated funding tactically aimed at reducing the market risk during a period of expected volatility and underpinning the business plan.
Grŵp Cynefin is using the initial proceeds to refinance four existing facilities in a strategic step to rationalise its loan portfolio, reduce its funding costs and increase the weighted average life of its debt portfolio.
Bryn Ellis (pictured), Business Services Director at Grŵp Cynefin, said: “Our long-term treasury strategy is always prepared for some volatility, but this new funding improves our ability to manage liquidity and interest risks going forward.”
Shan Lloyd Williams, Grŵp Cynefin Chief Executive, saluted the help from Centrus in strengthening liquidity with the potential to deliver 400 new homes by 2021.
“(We) are looking forward to building a long-term relationship with BAPFIM as a Grŵp Cynefin funding partner,” she said.
Barry Greyling, Director at Centrus, who led the Centrus team, said such attractive terms achieved in a period characterised by market uncertainty and volatility were testament to an organisation “well led and with a clear strategy as a leading provider of social housing”.
He said: “Centrus is pleased to have supported Grŵp Cynefin in this highly successful debut capital markets transaction.”
David Cryer, Head of Liability Driven Investments (LDI) and Private Placements at BAPFIM, said: “We are delighted to be providing Grŵp Cynefin with a long-term funding solution, which reflects our continued commitment to the sector and demonstrates our flexibility in meeting Grŵp Cynefin’s drawdown requirements.”
Devonshires provided legal advice to Grŵp Cynefin on the private placement and banking documentation, and Clarke Willmott advised on security charging.
Winckworth Sherwood advised BAPFIM on the security charging and documentation.