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.
