CML Group Limited (CML) launched a new issue on 19 May, with a $15m fixed rate senior secured bond due March 2022. Its existing $25m May 2021 floating rate senior secured bond is now available to retail investors
The new 2022 fixed rate bond has been issued with a 5 year par call and a 6 year final legal maturity. The bond has a fixed interest rate of 8.00% p.a. payable monthly in arrears between the issue date and par call date, with a minimum parcel investment of $20,000 available exclusively through FIIG. The notes are to be consolidated and form a single series with the issuers’ existing $25m fixed rate notes due 18 March 2022, issued 23 March 2016.
This bond is an excellent consideration for wholesale clients who want to lock in a high fixed rate of return and are looking to diversify their fixed income exposure.
CML’s May 2021 floating rate note has been made available to retail investors. Current yield to maturity is 7.01% per annum. More information can be found on the company factsheet
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About CML
CML is an ASX listed provider of finance, payroll and recruitment services. The group has a market capitalisation of $18m as at 16 May 2016, with a further $10m of listed convertible notes.
CML’s two operating areas are finance, which provides disclosed factoring to small and medium enterprises; as well as payroll and other, which provides outsourced payroll solutions, employment and recruiting as well as immigration services.
The notes are backed by CML’s asset book and are protected by reserving requirements that strengthen as performance deteriorates. Proceeds from the notes will assist in financing the acquisition of 180 Group Pty Ltd, which will increase CML’s loan book from $30m to $60m. This is conditional only on CML obtaining funding, as well as ensuring that it has funds to support near term growth of the business.
Both bonds are senior secured with a first right to cashflows from assets provided as security, after statutory preferred creditors.
An accompanying CML research report can be viewed here