TradeRisks arranges £250m listed bond for Midland Heart

Midland Heart Limited, one of the largest housing providers in the UK which manages over 33,000 units in the East and West Midlands, has issued a £250m fixed rate bond maturing in 2050. Midland Heart have sold £100m of bonds and retained a further £150m for future sale.

The bonds, which are rated A1 by Moody’s Investor Services, were placed with institutional investors following a competitive funding process.

The bonds were issued at par and the coupon was set at 1.831%, a credit spread of 120bps above the yield on the benchmark gilt.

The funds raised from the bond issue will further support Midland Heart’s activities to fill the gap for the need of affordable housing in the UK.

TradeRisks acted as sole arranger and dealer on the issue.

Antoine Pesenti, Head of Capital Markets at TradeRisks, said “We are pleased to have delivered this transaction for Midland Heart, once again demonstrating that by approaching the market in a considered way it is possible to secure attractive and well-tailored funding solutions. Midland Heart have been able to secure a sub-benchmark funding amount at a credit spread on par with recent benchmark size issues, whilst avoiding the execution risk associated with syndication, heavy covenants associated with standard medium size private placements and large cost of carry from large bonds”

Glenn Harris, Chief Executive of Midland Heart said “We are extremely pleased to be issuing this bond with our strong A1 credit rating. This is testimony to the strong financial position Midland Heart is in and will help us to support the post Covid-19 economic recovery in the Midlands. Providing customer excellence is at the heart of everything we do and this increased investment will help to further improve the services that our customers rely on and develop more affordable homes for those who need them."