EDINBURGH-based Standard Life yesterday unveiled a £500m bond issue as the firm looks to improve its balance sheet.
The life insurer and pension provider is enjoying a purple patch, with its shares up 50 per cent since June and analysts believe its business model is well-placed to deal with forthcoming regulatory changes.
“We have taken advantage of favourable market conditions to improve the leverage position of the Standard Life Group via a subordinated debt issuance directly from our holding company,” said chief financial officer Jackie Hunt.
“The strong order book and successful placement is a powerful signal of investors’ confidence in Standard Life’s financial strength and strategic plans.”
The issue, which the firm says is heavily oversubscribed, will pay 5.5 per cent interest for the next ten years. The offering is expected to close on 4 December.
The bonds are expected to be rated “Baa2” by Moody’s and “BBB” by Standard & Poor’s.
Banks involved in the deal included Barclays, Deutsche Bank, Bank of America Merrill Lynch (BAML), RBS and UBS.
Barclays’ team was led by Mark Geller and Peter Mason, while the BofAML team included Theo Lentzos, Gareth Braithwaite and Robin Palmer.
The news follows yesterday’s announcement that Standard Life is set to open its first office in the Middle East as it looks to expand overseas.