Flagship

Flagship Investments Limited (ASX: FSI) Convertible Note

Flagship Investments Limited (ASX: FSI) has launched a listed redeemable, unsecured convertible note issuance (ASX: FSIGA), seeking to raise up to AUD20 million.

Key Terms

Total offer size of up to AUD20.0m
Offer price of $2.70
Interest rate: 5.50% paid quarterly until Step Up date of 30 September 2024
After Step up date (3 years after issue) increases to 6.50%
1 Convertible Note converts to 1 ordinary share
Maturity date of 1 October 2026 (5 years) (if not converted or redeemed earlier)
Application will be made for quotation of the FSI Notes on ASX under ticker code: FSIGA.ASX
Subject to shareholder approval, the Directors and Senior Management will acquire 25% of the issuance
Loan-to-Value (LTV) cap of 50%. Cpn step-up of 2% and dividend stopper if breached

Capital Structure

FSI currently does not have any prior ranking debt and has committed to not extend indebtedness beyond the $20 million raising. This provides Investors with relatively low-risk access to a 5.5-5.90% return with additional upside (underlying share price appreciation).

Chart 1. Key Offer Features

Source: Flagship Investments Prospectus Presentation

Comparable Securities

Security	Issuer	Mty3	Px	B YTM
NSCAU 4.95 24	NAOS Small Cap Opp Co	3/12/2024	100.5	4.78
MVTAU 4.8 26	Mercantile Investment Co	10/07/2026	100.52	4.89
FSIGA 5.50 26	Flagship Investments	1/10/2026	100.00	5.90
NACAU 5.5 27	NAOS ex-50 Opp Co Ltd	30/09/2027	107.001	4.61
NCCAUD 4.5 28	NAOS Emerg Opp Co Ltd	30/09/2028	102.41	4.77

We are taking bids now. Please let me know if you have any interest.

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