LONDON--(BUSINESS WIRE)--Assured Guaranty (Europe) Ltd. (AGE)* announced that it has guaranteed principal and interest payments on approximately £98 million par of bonds, issued by Uliving to refinance student halls of residence at the University of Essex Colchester campus. As a result of the guarantee, the bonds are rated AA by S&P.
The publicly listed, 42-year bond priced on 22 February 2017 taking advantage of the current low long term real rates by issuing at a negative real yield (prior to factoring in inflation).
The sponsor, Uliving, was established in 2009 to develop student accommodation projects in partnership with universities. The bonds will refinance a project that has been operational since 2013 and consists of two buildings on the University’s Colchester campus, providing a total of 1,429 student rooms.
Dominic Nathan, Managing Director, AGE, commented:
"We are now seeing a stronger flow of refinancing opportunities like this one, across various sectors and PFI projects, because of the current low interest rate environment, coupled with the increased number of investors choosing to invest in longer maturities in order to match their liabilities. These are excellent conditions to refinance with a wrapped bond and reduce the cost of debt.”
Assured Guaranty closed a similar transaction for the University of London at the end of December.
Nick Proud, Chief Executive, AGE, commented:
“There is strong demand from investors for highly rated infrastructure bonds as a direct result of Solvency II. In this transaction, as with others we have closed, a wrap proved to be the most cost-effective solution to deliver this refinancing."
As the financial guarantor, AGE guarantees timely payment of scheduled principal and interest to bondholders throughout the life of the bond, in accordance with the terms of its financial guarantee.
* AGE (company number 2510099) is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. AGE provides its financial guarantee together with a co-guarantee from its affiliate Assured Guaranty Municipal Corp. (AGM).
Through its subsidiaries, Assured Guaranty Ltd. (AGL and, together with its subsidiaries, Assured Guaranty) is the leading provider of financial guarantees for principal and interest payments due on municipal, public infrastructure and structured financings. Its subsidiary AGM guarantees international infrastructure and U.S. municipal bonds - and was previously named Financial Security Assurance Inc. (FSA) before becoming an Assured Guaranty company in July 2009. AGE, a subsidiary of AGM, is Assured Guaranty’s European operating platform. AGL is a publicly traded (NYSE: AGO), Bermuda-based holding company. More information on AGL and its subsidiaries can be found at AssuredGuaranty.com.
Cautionary Statement Regarding Forward-Looking Statements:
Any forward-looking statements made in this press release reflect Assured Guaranty’s current views with respect to future events and are made pursuant to the safe harbour provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. These risks and uncertainties include, but are not limited to, those resulting from Assured Guaranty’s inability to execute its strategies; the demand for Assured Guaranty’s financial guarantees; further actions that the rating agencies may take with respect to Assured Guaranty’s financial strength ratings; adverse developments in Assured Guaranty’s guaranteed portfolio; and other risks and uncertainties that have not been identified at this time, management’s response to these factors, and other risk factors identified in AGL’s filings with the U.S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which are made as of 27 February 2017. Assured Guaranty undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.