Transport Operator SCT Logistics Launches $85 Million Bond Issue

sctNational multi-modal transport and logistics company SCT Logistics will undertake Australia’s largest unrated bond issue for a private business through a dual-tenor issue of $75-85 million to be arranged by FIIG Securities.

The bond issue comprises two types of bonds: Series A – minimum of $30 million of four year floating-rate notes, and Series B – minimum of $45 million of six-year fixed-rate notes.

SCT founder and Chairman Peter Smith said the funds would be used to pay down the company’s existing debt and diversify its funding sources.  “This bond issue will deliver us a more flexible funding arrangement and a balanced debt profile” Mr Smith said.

“It gives us greater certainty to plan our operations and invest over the medium to long term. As a private company, the ability to access a new investor base via the debt capital markets is a real competitive advantage, reinforcing the scale and pedigree of the SCT business. ”

The bonds will have a minimum initial investment of $50,000 at issue and will be distributed to new and existing FIIG Securities clients who qualify as sophisticated or professional investors.

FIIG CEO Mark Paton said the offering, which followed a series of recent bond issues, was further evidence of the growing awareness among Australian corporates that a bond issue was a reliable funding option.

“SCT Logistics is another example of a quality Australian company with a well-established business that is seeking funding from bond investors for the first time,” Mr Paton said.

“This is a very positive development because it recognises that private companies such as SCT Logistics can access the Australian bond market, reinforcing the maturity of the market and servicing the diversification needs of both investors and issuers.”

Melbourne based SCT Logistics was established in 1974 and is now a national transport and logistics company providing predominantly longhaul rail freight services. It has an integrated business with its own truck, locomotive and rolling stock and also operates terminals and warehousing.  The company is owned by the Smith Family.

The SCT Logistics bond issue is the fifth that FIIG has arranged for 2015, following successful issues by CML Group ($25 million), MoneyTech ($25 million), McPhersons ($60 million) and Dicker Data ($40 million), bringing the total FIIG led bond issuances to $900 million over the past 3 years.

FIIG Securities Limited, which is licensed by the Australian Securities and Investments Commission (ASIC), is Australia’s largest specialist fixed-income dealer. FIIG has more than $11 billion in term deposits and corporate bonds under advice in its short-term money market, bonds and custody business.  The company has offices in Sydney, Melbourne, Brisbane and Perth. For more information about FIIG Securities please visit www.fiig.com.au

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