Neuberger Berman

NB Global Corporate Income Trust

1 for 1 Entitlement Offer and Shortfall Offer

Equity Trustees Limited as the Responsibly Entity (RE) has announced the launch of NB Global Corporate Income Trust (NBI) (Trust) 1 for 1 Entitlement Offer and Shortfall Offer(1) to raise up to approximately $476.3 million(2). NBI listed on the ASX on 26 September 2018 and provides investors with an opportunity to receive monthly income by investing in high yield bonds issued by large, liquid companies globally.

Since listing on the ASX, the Trust has paid monthly distributions to existing Unitholders amounting to 6.125 cents per Unit, with distributions commencing in November 2018.

The Trust pays monthly income and targets a net cash return of 5.25% per annum.

Neuberger Berman (NB) as the Manager hedges all currency exposures back to AUD and employs hedging techniques designed to minimise fluctuations in the value of the Trust's investments by reducing the risk of adverse movements in currency exchange rates and, potentially, interest rates.

Offer Structure

  1. Entitlement Offer – The RE has announced a pro-rata non-renounceable 1 for 1 Entitlement Offer to raise up to approximately approximately $476.3 million – Record Date 31 May 2019
  2. Oversubscription Facility – The Entitlement Offer includes an Oversubscription Facility which will allow eligible unitholders to subscribe for units in excess of their entitlement
  3. Shortfall Offer – New investors will have the opportunity to apply for units (minimum 2,500 units) in the Trust which have not been taken up under the Entitlement Offer

The New Units to be issued under the Offer will rank equally with existing Units on issue at the time of allotment including full entitlement to any distributions declared on or after the allotment date (being [3 July] 2019 for the Entitlement Offer and [12 July] 2019 for the Shortfall Offer)

Offer Price

  • Offer price per New Unit under the Offer is $2.00 (NAV)
  • The Offer Price is based on the NTA per unit as at 10 May 2019, net of estimated Distributable Earnings for the financial year ending 30 June 2019
  • 3.4% discount to the last closing price of NBI’s ordinary units as traded on ASX on 13 May 2019 ($2.07)

Who can participate

Eligible Unitholders

  • Unitholders who are eligible to participate in the Entitlement Offer (“Eligible Unitholders”) can subscribe for 1 new unit for every existing 1 unit held on the Record Date being 31 May 2019
  • Eligible Unitholders can apply for units in excess of their entitlement under the Entitlement Offer under the Oversubscription Facility (details of which are set out in Section 11 of the PDS)

New Investors

  • Investors who are not eligible to participate in the Entitlement Offer and meet conditions outlined in the PDS can apply for Units under the Shortfall Offer
  • You should note that there is no guarantee that Units will be allocated under this Offer

Use of Funds

  • The investment strategy for the Trust is to invest in and actively manage a portfolio of high yield bonds issued by companies located globally across both developed (e.g. the U.S. and the U.K.) and emerging (e.g. Brazil and Indonesia) markets, with a strong emphasis on capital preservation by focusing on higher quality bonds within the Global High Yield Market, large and more liquid companies and by avoiding companies with deteriorating financials.

Advantages of the Raising

  • Greater scale and portfolio diversification
  • Additional capacity to invest in opportunities which meet NBI’s disclosed investment objectives
  • Lower total costs to unitholders whilst maintaining target return
  • Supportive of ongoing market liquidity of NBI

Key features of the offer

  • Issue price of $2.00 per unit, a 3.4% discount to the last closing price of NBI’s ordinary units as traded on ASX on 13 May 2019 ($2.07)(3)
  • Minimum of 2,500 units must be applied for under the Shortfall Offer
  • Monthly target cash distributions of 5.25% p.a.(4) (net of fees and expenses)
  • Exposure to the high yield bonds of global companies
  • Access to the expertise of specialist portfolio managers located around the world
  • Portfolio diversification, offering exposure to a portfolio of 250-350 bonds issued by large, liquid global companies and complimentary to other fixed interest investments
  • Emphasis on capital preservation by focusing on higher quality rated high yield corporate bonds(5)
  • ASX-listed liquidity

Issuer: Neuberger Berman (NB)

Transaction: Entitlement Offer and Shortfall Offer

Morgans Role: Joint Arranger and Joint Lead Manager

Offer Size: $476.3 million

Offer Open: 5 June 2019

Morgans Closing Date: 24 June 2019

  1. Morgans will receive fees for its role.
  2. The Offer size may be less than $476.3 million.
  3. As traded on ASX on 13 May 2019 ($2.07).
  4. The target distribution rate is set at 5.25%.
  5. The NAV will reflect the value of the bond portfolio and move accordingly.

Application form

Investors should review the PDS to understand the features and risks of the NB Global Corporate Income Trust. Application for NB Global Corporate Income Trust can only be made by completing the application form attached to the PDS.

If you have any questions about the offer, please contact your Morgans adviser, call 134 226 or find your nearest office here.

Download Prospectus

NB Global Corporate Income Trust Units are being offered only in Australia and New Zealand and the PDS will only constitute an offer to a person receiving it in Australia and New Zealand. Not for distribution, directly or indirectly, in the United States or to, or for the account or benefit of, US Persons, except in accordance with an available exemption from the registration requirements of the US Securities Act. The distribution of the PDS (including an electronic copy) in jurisdictions outside Australia may be restricted by law.

Download
  • Print this page
  • Copy Link