PHP issues £70m secured bond

Primary Health Properties PLC has completed the issue of a new twelve year £70m secured bond to an institutional grade bond investor. The Bond is issued on a floating rate basis, paying interest at a margin of 220 basis points over six month LIBOR, and extends the average maturity of PHPs debt facilities to more than 6.1 years (30 June 2013: 5.2 years). The proceeds of the Bond will be received in two tranches. The first tranche of £60m will be received immediately and will be used to refinance three existing loan facilities: one with Clydesdale Bank plc which was due expire in early 2014; the Aviva loans acquired with the PHCC acquisition in July; and a tranche of the Group’s Club facility with Royal Bank of Scotland Plc and Santander Banking Group where the margin was to step up in March 2014. A second tranche of £10m will become available on 30 June 2014 as a committed development is completed. The Bond issue does not impact on the Group’s existing interest rate hedging portfolio.