12th Sep 2006 14:40
Mitchells & Butlers PLC12 September 2006 12 September 2006 NOT FOR DISTRIBUTION IN THE UNITED STATES MITCHELLS & BUTLERS PLC £1.1bn BOND ISSUE Mitchells & Butlers today announces that the terms of the bond issue launched on31 August have been finalised. The total amount to be raised is £1.1bn, £655m ofwhich is incremental financing and the balance of £450m will be used torefinance existing sterling and dollar denominated Floating Rate Notes.The average cash interest cost on the new bonds will be 5.4%. As a result, the total securitised debt of Mitchells & Butlers will increase to£2.46bn and the overall cash interest cost of this debt will reduce toapproximately 5.7% before tax. Completion and issue of the bonds is expected to take place on Friday 15September. As previously stated, following completion of the bond issue, Mitchells &Butlers will pay a special dividend of £1 per share, amounting to approximately£486m, to shareholders, which will be accompanied by a proportionateconsolidation of the shares in issue. An Extraordinary General Meeting of shareholders will be held to approve theproposed share consolidation accompanying the special dividend. Full detailswill be provided in a circular to shareholders. It is currently anticipated thatthe circular will be posted before the end of September and that the specialdividend will be paid before the end of October. Commenting on the issue, Karim Naffah, Finance Director said: "We have had an excellent response to our bond issue. The strong operationalperformance of our pub estate and the resulting property appreciation haveenabled us to raise additional debt on attractive terms. This allows us to makea further substantial cash return to shareholders, in addition to theacquisition of 239 pub restaurants successfully concluded earlier this year." The details of the new bonds are as follows: Class Rating Amount CouponA1N AAA/AAA/Aaa £200m £Libor + 18bpsA3N AAA/AAA/Aaa $418.75m $Libor + 18bpsA4 AAA/AAA/Aaa £170m £Libor + 23bpsAB AAA/AAA/Aaa £325m £Libor + 24bpsC2 BBB+/BBB+ £50m £Libor + 75bpsD1 BBB/BBB £110m £Libor + 85bps Notes: 1. All bonds pay interest quarterly2. Rating = S&P/Fitch/Moody's3. The A3N class of $418.75m is equivalent to £250m The floating rate and currency exposures of the bonds will be hedged throughswaps such that all of the interest costs to the Company on the securitised debtare fixed. The bond issue was arranged and managed by the Royal Bank of Scotland andCitigroup. For further information, please contact: Investor RelationsKate Holligon 0121 498 5092 MediaFinsbury Group - James Murgatroyd 020 7251 3801 Further information on Mitchells & Butlers' existing Securitisation is availableunder "Securitisation & Debt information" at www.mbplc.com. Cautionary note regarding forward-looking statementsThis announcement contains certain forward-looking statements as defined underUS legislation (section 21E of the Securities Exchange Act of 1934) with respectto the financial condition, results of operations and business of Mitchells &Butlers and certain of the plans and objectives of the board of Directors withrespect thereto. These forward-looking statements can be identified by the factthat they do not relate only to historical or current facts. Forward-lookingstatements often use such words as 'will', 'should', 'continue', 'anticipate','target', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe' or otherwords of similar meaning. The forward-looking statements contained herein arebased on assumptions and assessments made by Mitchells & Butlers' management inlight of their experience and their perception of historical trends, currentconditions, expected future developments and other factors they believe to beappropriate. By their nature, forward-looking statements are inherentlyspeculative and involve risk and uncertainty, and there are a number of factorsthat could cause actual results and developments to differ materially from thoseexpressed in or implied by such forward-looking statements. These factorsinclude, but are not limited to: the future balance between supply and demandfor Mitchells & Butlers' sites; the effect of economic conditions and unforeseenexternal events on Mitchells & Butlers' business; the availability of suitableproperties and necessary licenses; consumer and business spending, changes inconsumer tastes and preference; levels of marketing and promotional expenditureby Mitchells & Butlers and its competitors; changes in the cost and availabilityof supplies; key personnel and changes in supplier dynamics; significantfluctuations in exchange rates, interest rates and tax rates; the availabilityand effects of any future business combinations, acquisitions or dispositions;the impact of legal and regulatory actions or developments; the impact of theEuropean Economic and Monetary Union; the ability of Mitchells & Butlers tomaintain appropriate levels of insurance; the maintenance of Mitchells &Butlers' IT structure; competition in markets in which Mitchells & Butlers'operates; political and economic developments and currency exchangefluctuations; economic recession; management of Mitchells & Butlers'indebtedness and capital resource requirements; material litigation againstMitchells & Butlers; substantial trading activity in Mitchells & Butlers'shares; the reputation of Mitchells & Butlers' brands; the level of costsassociated with leased properties; competition for high quality managers;declining sales of beer in pubs in the UK; food safety scares; fundingliabilities in respect of the Group's pension schemes and the weather. -ends- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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