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Your Housing Group raises £120m and completes treasury restructure
Warrington-based housing association Your Housing Group (YHG) has raised £120m via two private placements.
The association, which owns and manages 28,000 homes, said the notes comprise of four maturities with a weighted average life of around 34 years.
Despite volatile market conditions, the transaction included a coupon of around 2.5% and an attractive covenant package.
YHG’s private placements come after a number of large housing associations issued bonds during the coronavirus pandemic, with other smaller organisations accessing the capital markets via aggregators.
The transaction follows a restructure of YHG’s banking relationships from December 2019, which established a 10-year revolving credit facility across three core banks, removed EBITDA-MRI-based interest cover covenants, and provided significant liquidity.
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These arrangements underpin a 10-year strategy to provide investment for existing assets and develop more than 10,000 homes across a range of rent tenures.
Jeremy Earnshaw, chief financial officer at YHG, said: “The completion of these new facilities is an important milestone for Your Housing Group.
“Delivering on our treasury strategy in these highly uncertain times has been a real achievement for YHG, and we are looking forward to implementing the next stage of our plans.”
Financial consultants Centrus were the sole advisor for the private placements and development of the new treasury strategy. Law firm Devonshires advised on the corporate and financing aspects, including the property security elements which will underpin the new financing arrangements.
John Tattersall, director at Centrus, commented: “The combination of this vision and strong financial metrics have been instrumental in delivering this transaction despite recent market volatility, with the coupon underlining the continued attraction of the housing sector for long-term investors seeking stable and low-risk investments.”
