Strong demand for Macquarie Group’s new Capital Notes II in the institutional book-build process has seen the offer closed early and the issue upsized from an indicated $400 million to at least $500 million, which is the amount allocated to brokers and institutional investors. The general offer has also been closed but the security holder offer remains open until the 15 December.
The margin has been fixed at 5.15%, which is at the lower end of the initially indicated 5.15% to 5.35% range. This margin is fixed for the life of the notes and is on top of the 180 day BBSW reference rate which is reset every six months. In a slightly unusual move, the reference rate will be equal to 90 day BBSW for the first distribution period which ends in March 2106. At the current BBSW rate, the total return for the first year would be around 7.40% including a franked component equal to 40% of the distribution.
The $500 million is the amount allocated to brokers and institutional investors with the final issue size determined by the securityholder allocation. Click here for the product disclosure statement (prospectus).