Ashurst has advised Rabobank on a new series of A$325m Puttable Floating Rate Notes due 4 May 2017 under its $15bn Debt Issuance Programme. The 12-month notice period for the put option is a first in the Australian market.
The Ashurst team was led by Banking and Finance partner Paul Jenkins and special counsel James Morris with partner Teresa Dyson and senior associate Bronwyn Kirkwood assisting with tax issues.
By exercising the put option, holders receive a new series of one-year notes (in exchange for the early redemption of their original 2017 notes), effectively “cashing out” their original five-year notes with 12-months’ notice. Holders also retain their right to receive coupon payments for that period under the new notes, matching the coupon they would have been entitled to for that same period under their original five-year notes.
This option, which was structured so that it could be exercised prior to the issue date of the notes (ie, on the trade date for the notes) or on subsequent interest payment dates, was exercised on the trade date in relation to an aggregate principal amount of A$225m of the 2017 notes. In practice, this meant that Rabobank issued a separate series of one-year notes to those exercising investors on the same issue date as the 2017 notes.
According to Rabobank, the structure of the trade allows Rabobank, as an issuing bank, to satisfy net stable funding ratio requirements, while capturing demand from investors for shorter-dated securities.
HSBC acted as Lead Manager and Computershare Investor Services Limited acted as Registrar & Paying Agent.
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