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Centrus arranges £150m of long term debt for Mercantile Investment Trust

The Mercantile Investment Trust plc announced that it has raised an additional £150 million of long-term debt through the issue of three fixed rate, senior unsecured privately placed notes. The Notes, which will be funded on 8th September 2021, are:

• £55 million maturing in 2041 with a fixed coupon of 1.98%

• £50 million maturing in 2051 with a fixed coupon of 2.05%

• £45 million maturing in 2061 with a fixed coupon of 1.77%.

The net proceeds from the Notes will be used to repay the Company’s short-term indebtedness of £80m. The balance of the proceeds will be available to be invested as and when attractive opportunities arise. The Company’s short-term debt facility will remain available providing further investment flexibility.

Centrus Financial Advisors Limited acted as the arranger of the Note issue.

Angus Gordon Lennox, Chairman of The Mercantile Investment Trust said: Given the increase in the Company’s asset base over recent years, the Board is very pleased to have been able to take advantage of current market conditions to re-balance the Company’s borrowing levels at attractive rates and over different and longer time periods. This new debt will ensure that there are adequate facilities in place to maintain gearing levels and if the Company’s Investment Managers see appropriate investment opportunities to be able to operate more fully across the Company’s gearing range.

There has been no change in the Company’s permitted gearing range as set by the Board, to limit gearing within the range of 10% net cash to 20% geared. The current level of net gearing is c. 9.6%1.

Press release date: 3rd September 2021