Coffey Corporate Pty Ltd launches $40m floating rate note issue

Key Points:

1.     Coffey Corporate Pty Ltd launches $40m Floating Rate Notes (wholesale investors only)

2.     Interest of 4.65% over bank bill equivalent to 7.82% yield to maturity*

3.     Senior unsecured notes with a 5 year term and interest paid quarterly

Key Highlights

• Coffey Corporate Pty Ltd (the "Issuer") is the financing subsidiary of Coffey International Limited ("Coffey"), an ASX listed professional services group that provides specialised consulting services in geoservices, international development (foreign aid projects) and project management.
• Coffey was founded by David Coffey in 1959 and is headquartered in Sydney. It was first listed on the ASX in 1990 and currently has a market cap of approx $90m.
• Between 2003 and 2008 Coffey expanded to become a global operator across six key geographical regions: Australia, the Americas, UK, Middle East, New Zealand and Africa; and five industries: transport infrastructure, oil & gas, mining, property and international development (foreign aid).
• FY14 saw the completion of a three year rebuilding process amidst tough trading conditions. Coffey established the fundamentals of its business and weathered a cyclical downturn to deliver considered, meaningful change including a return to profit in FY14.
• Coffey has reduced its gross debt from A$151m in FY11 to A$77m in FY14 and aims to continue this deleveraging over the coming years.
• The floating rate notes are senior unsecured obligations of the Issuer, guaranteed by Coffey and certain subsidiaries of Coffey.

* Based on 5 year swap rate of 3.17% p.a. as at 1 September 2014

Coffey International Limited: Snapshot

Coffey provides professional consulting services across a range of sectors:

The offer

Coffey Corporate Pty Ltd (ABN 30 001 727 171) ("Issuer"), guaranteed by Coffey International Limited (ABN 16 003 835 112) ("Coffey") and certain subsidiaries of Coffey, to issue $40,000,000 senior unsecured and unsubordinated Australian Dollar Floating Rate Notes ("Notes").

Coffey (ASX: COF) has today launched the issue of a five year, senior unsecured floating rate note issue ("Notes") with an indicative margin over 90 day bank bill of 4.65% per annum available exclusively through FIIG Securities Limited ("FIIG"). Coffey is seeking to raise A$40,000,000 to repay senior secured bank debt.

FIIG is the Sole Lead Arranger for this transaction and the Notes are available to wholesale clients only (pursuant to the Corporations Act Cth 2001), with an initial minimum subscription of A$50,000 and in increments of A$10,000 thereafter.

The Issuer - Coffey Corporate Pty Ltd

The Issuer is a fully owned financing subsidiary of Coffey. Coffey provides specialised consulting services in geoservices, international development (foreign aid) and project management. For more information about Coffey please visit their website www.coffey.com or go to www.asx.com.au (ASX: COF). Please also read the FIIG Research on Coffey available here.

Information about the Notes

The Preliminary Information Memorandum, which is subject to completion, dated 2 September 2014 includes the draft terms and conditions of the Notes and is available here. A summary of the Notes is included below in "Notes summary".

Who should consider this offer

The Notes are an attractive investment for wholesale clients looking to lock in a high floating rate of return and/or are looking to diversify their fixed income exposure.

How to find out more and to apply

For more information talk to your FIIG Representative.

To provide your Firm Bid for Notes contact your FIIG Representative on 1800 01 01 81 or alternatively email newissue@fiig.com.au.

Key dates

TUESDAY 2 SEPTEMBER 2014: Offer Opens - Offer opens to FIIG clients to subscribe for Notes. FIIG clients are invited to provide Firm Bids for Notes by contacting your FIIG Representative.

WEDNESDAY 3 SEPTEMBER 2014: Offer Closes - FIIG clients are to provide Firm Bids for Notes as soon as possible but no later than by close of business on Wednesday 3 September 2014 by contacting your FIIG Representative. FIIG reserves the right to close the Offer earlier or later in its absolute discretion.

Firm Allocation made by FIIG to clients - After you inform FIIG of your Firm Bid, FIIG will send you a firm allocation of Notes "Firm Allocation" by email with the pricing and payment details in relation to the Notes.

Clients to accept by reply email - Clients must, by reply email to FIIG, irrevocably accept the Firm Allocation and forward cleared funds to FIIG immediately upon accepting the Firm Allocation. You will only be entitled to an allocation of Notes if FIIG has received payment of cleared funds by the due date.

Acknowledgement sent by FIIG - Upon FIIG's receipt of your emailed acceptance of the Firm Allocation, FIIG will send you an acknowledgement by email to you with a reminder of payment details.

MONDAY 8 SEPTEMBER 2014: Money to be received by FIIG - Due date for the receipt of Cleared Funds to FIIG for a Firm Allocation of Notes.

 FRIDAY 12 SEPTEMBER 2014: Settlement date and Notes issued

The dates set out in this email may be varied at FIIG's absolute discretion without further notice to you.

Notes summary

• Floating rate offering with an indicative margin over 90 day bank bill of 4.65% per annum. The final margin will be confirmed by FIIG prior to the issue of the Notes.
• Five year maturity with interest paid quarterly in arrears.
• The Notes rank as senior unsecured and unsubordinated obligations of the Issuer and the Guarantors (including Coffey International Limited).
• Investors have a put option at 101% of the face value of the Notes upon a change of control of Coffey.
• The Issuer may call some or all of the Notes prior to maturity at a premium to the Note face value.

• The senior secured lender receives a priority payment to the Notes only in the event of a wind up. All ongoing obligations for payment of interest and principal to the senior secured lender rank equally with the Notes. Non-payment of principal and interest to the senior lender will amount to an event of default of the Notes also.
• The Notes benefit from a covenant package that has limits on Coffey's ability to borrow in the future, as well as covenants present in the secured facility. The Notes are structured in line with similar bond issues in the global high yield market and provide key structural benefits for investors when compared to recent ASX listed corporate hybrid transactions.

• The Notes are not listed on an exchange or rated by a ratings agency

Important information

The information has not been lodged with Australian Securities and Investments Commission or any other authority. Any securities that may be offered by the Issuer in, or into, Australia are offered only as an offer that would not require disclosure to investors under Part 6D.2 or 7.9 of the Corporations Act. The information is a summary only and does not purport to be complete. It does not amount to an express or implied recommendation or a statement of opinion (or a report or either of those things) with respect to any investment in the Issuer nor does it constitute a financial product or financial advice. The information does not take into account the investment objectives, financial situation or needs of any particular investor. FIIG does not provide accounting, tax or legal advice. Prospective investors are required to make their own independent investigation and appraisal of the business and financial condition of the Issuer and the nature of any securities that may be issued by the Issuer. By accepting receipt of the information the recipient will be deemed to represent that they possess, either individually or through their advisers, sufficient investment expertise to understand the risks involved in any purchase or sale of any financial securities discussed herein.

FIIG has been engaged by Coffey Corporate Pty Ltd and Coffey International Limited to arrange the issue and sale of the Notes by the company and will receive fees from the issuer of the Notes. FIIG, its directors and employees and related parties may have an interest in the company and any securities issued by the company and earn fees or revenue in relation to dealing in those securities.

Disclaimer

FIIG Securities Limited ('FIIG') provides general financial product advice only. As a result, this document, and any information or advice, has been provided by FIIG without taking account of your objectives, financial situation and needs. Because of this, you should, before acting on any advice from FIIG, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If this document, or any advice, relates to the acquisition, or possible acquisition, of a particular financial product, you should obtain a product disclosure statement relating to the product and consider the statement before making any decision about whether to acquire the product. Neither FIIG, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice. FIIG, its staff and related parties earn fees and revenue from dealing in the securities as principal or otherwise and may have an interest in any securities mentioned in this document. Any reference to credit ratings of companies, entities or financial products must only be relied upon by a 'wholesale client' as that term is defined in section 761G of the Corporations Act 2001 (Cth). FIIG strongly recommends that you seek independent accounting, financial, taxation, and legal advice, tailored to your specific objectives, financial situation or needs, prior to making any investment decision. FIIG does not make a market in the securities or products that may be referred to in this document. A copy of FIIG's current Financial Services Guide is available at www.fiig.com.au/fsg.

An investment in notes or corporate bonds should not be compared to a bank deposit. Notes and corporate bonds have a greater risk of loss of some or all of an investor's capital when compared to bank deposits. Past performance of any product described on any communication from FIIG is not a reliable indication of future performance. Forecasts contained in this document are predictive in character and based on assumptions such as a 2.5% p.a. assumed rate of inflation, foreign exchange rates or forward interest rate curves generally available at the time and no reliance should be placed on the accuracy of any forecast information. The actual results may differ substantially from the forecasts and are subject to change without further notice. FIIG is not licensed to provide foreign exchange hedging or deal in foreign exchange contracts services. The information in this document is strictly confidential. If you are not the intended recipient of the information contained in this document, you may not disclose or use the information in any way. No liability is accepted for any unauthorised use of the information contained in this document. FIIG is the owner of the copyright material in this document unless otherwise specified.