19th Apr

Worth a Try? Quins issues 5.5%-Mini Bond

The Harlequin Football Club – more often Harlequins or ‘Quins’ - one of the world's oldest rugby clubs, is looking to raise £7.5million by issuing a mini-bond to fans and investors alike paying 5.5% interest p.a. in twice yearly payments.

Formed as The Hampstead Football Club in 1867 Quins, who play at the 14,800 capacity Twickenham Stoop in South West London, have had a mixed bag of a season but remain in with a shout for a top six finish in the Aviva Premiership that would give them automatic entry to the European Champions Cup next season, and have an upcoming European Challenge Cup semi-final against Grenoble.

Proceeds from the ‘Harlequin FC Bond’ will be invested in ‘furthering the Club’s long-term ambitions of building new audiences at home and abroad, expanding the horizons of the professional game, growing the business, and remaining in the top tier of professional rugby to the further develop the Harlequins name’.  

David Ellis, chief executive of Harlequins, said: 'The proceeds will enable us to invest in the club, take us to new levels and to continue to stay ahead of the game as it grows.

'Our goal is to be the best rugby club in Europe and the best sports club in the world.'

Buoyed by the success of 2015’s Rugby World Cup (off the pitch for those sporting the Red Rose), always the game of choice in the square mile, rugby is enjoying something of a purple patch at present, and recently Saracens and London Irish squared up at the red Bull Arena in New York in the first regular season Aviva Premiership match to be played in the States. The aim was to seek to maintain the momentum generated there by the increasingly impressive performances by the US Eagles in both fifteens and sevens.

The mini-bond is a five year fixed product that requires a minimum investment of £2,000 and multiples of £1,000 thereafter; they are not transferable and cannot be traded so have to be held to maturity.

Applications are open until 16th May 2016 and the club has indicated that it may issue up to £15million in the bonds to satisfy demand.

In 1870 it was decided to re-badge the club to reflect the fact that its reach had gone beyond Hampstead; apocryphally ‘Harlequin’ was picked from a dictionary because it allowed the club to retain its HFC monogram in a move that was so divisive that half of the members decamped and set up arch rivals London Wasps.

In a move that further emphasises rugby as a business, Wasps launched a retail bond of their own in 2015 offering 6.5%, to restructure its debt following a move to Coventry’s Ricoh Stadium and a move into the conference, exhibition and hospitality sectors; the bond was oversubscribed and met its £35million fundraising target within ten days.

Subscribers to Quins’ bond will be eligible to join its Quarters Club, along with two nominees, and benefit from its exclusive benefits.

The club had a record turnover of £17.9million for the year ending 30th June 2015, up 18% on 2013/14 – however, it operated at a loss of £1.3million in the same period, down from £2.3million the year before.

This season has seen its highest ever levels of membership, totaling 9,170 - an increase of 13% on the 2013/14 season membership of 8,079.

The Harlequin FC Bond is an unsecured debt of Harlequin Finance PLC and in the event that it became insolvent, investors could lose all of their investment as it would not be covered under the Financial Services Compensation Scheme.


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