Press release
URW announces an Exchange Offer on its Perp-NC 2023 hybrid
- Comprehensive solution for fixed income investors as an alternative to remaining invested in the Perp-NC 2023 hybrid notes
- Coupon of 7.25% and a Cash Amount
- Preserves equity content with rating agencies and supports URW’s ratings
The Group’s strategy
A key pillar of URW’s strategy is its deleveraging plan, to be achieved through the radical reduction of the Group’s financial exposure to the US and the execution of its European disposal plan. In this regard, the Group has made significant progress to date with €4.7 Bn of disposals completed since
This progress has been recognized by rating agencies, which have kept the Group’s ratings (BBB+/Baa2) and stable outlook unchanged in their FY2022 reviews.
Maintaining a solid capital structure, including the hybrid, is key to achieving URW’s strategic objectives in the best conditions within today’s challenging financing environment.
The Group’s strong operating performance and ample liquidity1 enables it to continue to act on its deleveraging plan in a timely and orderly manner. The strength of URW’s portfolio is demonstrated by the post-Covid recovery in both sales and footfall, and sustained demand from retailers for highly-productive space as part of their omnichannel strategy. The assets also offer a hedge against inflation through indexation and variable rents.
On completion of the deleveraging plan, URW will have a
The Existing Bonds and Exchange Offer
Hybrid instruments are an important component of URW’s capital structure. The instruments support the Group’s ratings and the delivery of its stated strategy and deleveraging plan.
After careful evaluation of the current restrictive hybrid primary market conditions, the Group has decided not to exercise its option to call the Existing Notes.
Understanding the impact of this decision on fixed income investors and considering the interest of all its stakeholders, the Group has decided to offer an alternative to remaining invested in the Existing Notes. Accordingly, the Group is today announcing an any-and-all par-for-par Exchange Offer in respect of the Existing Notes into a combination of (i) new hybrid notes with a coupon of 7.25%, and (ii) a Cash Amount (where applicable). The Cash Amount will result in a reduction of the Group’s overall hybrid portfolio, and will not exceed €200 Mn i.e. 10% of the outstanding aggregate hybrid portfolio.
The Exchange Offer is subject to achieving a minimum new issue size of €500 Mn to ensure the liquidity of the New Notes for investors.
In accordance with the terms and conditions, the coupon of the Existing Notes not exchanged will reset on
The Group expects its rating to be unchanged as a result of the completion of this transaction and the New Notes to be rated BBB- by S&P and Ba1 by Moody’s, two notches below URW’s issuer and senior unsecured ratings of BBB+/Baa2, in line with the existing hybrid instruments. Any portion of the Existing Notes that are not exchanged are expected to continue to benefit from Moody’s 50% equity credit whilst receiving a qualitative benefit from S&P.
All other hybrid instruments (including the Perp-NC 2026 and the New Notes) are expected to continue to benefit from a 50% equity credit treatment with both rating agencies. Any decision regarding the call of these bonds will be taken closer to their respective first call dates.
The Group intends to maintain its hybrid coupon payment policy.
All the Group’s hybrid notes will continue to achieve 100% equity accounting under IFRS.
The Exchange Offer will not be open to
Exchange Offer Details
The details of the Exchange Offer, including the New Notes and Cash Amount are further described in the Exchange Offer Memorandum, which is available on request from
Tel.: +33 1 42 98 44 19
Email: paris.bp2s.information.agent@bnpparibas.com
For more information, please contact:
Investor Relations
VP, Chief of Staff to the CEO
+1 424 303 1948
Alex.Estruch@urw.com
Media Relations
+44 7387 108 998
Cornelia.Schnepf@finelk.eu
+1 212 521 4826
Molly.Morse@kekstcnc.com
+33 6 27 84 91 30
Sonia.Fellmann@plead.fr
About Unibail-Rodamco-Westfield
The Group operates 78 shopping centres in 12 countries, including 45 which carry the iconic Westfield brand. These centres attract over 900 million visits annually and provide a unique platform for retailers and brands to connect with consumers. URW also has a portfolio of high-quality offices, 10 convention and exhibition venues in
URW is a committed partner to major cities on urban regeneration projects, through both mixed-use development and the retrofitting of buildings to industry-leading sustainability standards. These commitments are enhanced by the Group’s Better Places 2030 agenda, which strives to make a positive environmental, social and economic impact on the cities and communities where URW operates.
URW’s stapled shares are listed on Euronext Paris (Ticker: URW), with a secondary listing in
For more information, please visit www.urw.com
1 As per the Q1-2023 results announcement, €13.7 Bn of liquidity on a proportionate basis including €4.2 Bn of cash and €9.4 Bn of undrawn credit lines.
Attachment
- URW announces an Exchange Offer on its Perp-NC 2023 hybrid
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