26th Nov

Stobart Cancels Delivery of Retail Bond

Retail Bond Expert has learned this afternoon that Stobart Group has shelved its plans to enter the retail bond market by cancelling the proposed launch of the 5.5% per annum fixed rate six year sterling bond announced on 13th November.   

The Stobart Board had considered the issue of a retail bond on to the LSE’s burgeoning ORB exchange and saw it as a practical mechanism to diversify its corporate funding base.    

Set against a backdrop of increasing activity on the exchange and considerable consumer demand, the Group set what appeared to be a relatively modest target of £25m and such was the reported popularity of the issue that it was intimated that it would close early, as revealed by Retail Bond Expert on 22nd  November.   

However, the planned launch of the unrated bond did not receive universal approval in the press and following the entry of larger bond issuers at higher coupon pricing, the Board decided not to proceed.   

Stobart Chief Financial Officer Ben Whawell said: "We will keep under review the possibility of issuing a retail bond in the future, as we see it as a potential attractive funding option, but only when we feel the cost of the  bond to the company, its attractiveness to investors and its liquidity characteristics are in the right alignment." 

Stobart shares closed the day down 2.9% at 107.20.   

Later, Retail Bond Expert will examine this decision in more detail with commentary from key industry sources and will examine the implications for further activity in the retail bond space.  


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