Propifi Bonds plc – Bond programme to finance bridge lending

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Get the right advice from the start

Propifi Bond Programme Structure Final
  • Propifi is a bridging venture established by four of the industry’s most experienced and successful operators.  A core element of the company business plan is diversification of funding to minimise exposure risks and to ensure control over borrowing costs.
  • Critical to this plan was a bond programme that would provide a central funding stream for the making of bridging loans.
  • By September 2019, Propifi almost had a bond programme.  They were just working on the structural and legal steps to constitute the bonds.  All was looking good. 

Bad news and bad advice

  • Their principal source of advice, their arranger, went bust. 
  • Propifi took up the challenge of getting their bond issued themselves.  They quickly found they were missing multiple essential parties to their planned programme.  Among these was a corporate trustee, without whom their structure wouldn’t work.

“I wish we’d worked with Truva from the beginning.  It would have saved us years of work and what felt like decades of frustration.”
Craig Higgins, Director, Propifi

New advisors and a new plan

  • On a chance recommendation they called Truva Trustees.
  • Truva reviewed their situation, it was clear that the existing plan would need more time to complete than Propifi had to spare. Truva proposed a dual-strand solution:
    • An immediate certificated bond programme, salvaged from work already done, enabling bonds to be issued to waiting investors.
    • A near-term listed wholesale programme with an A-rated bond and electronic settlement in CREST that would achieve all of Propifi’s original objectives.

First bond programme launched as interim measure

  • The certificated programme launched in October 2019, allowing the issuance of bonds to investors who’d long been awaiting the opportunity to subscribe in Propifi bonds.

A pause for reflection

  • With an adequate solution in place for the short term, Propifi paused to take stock. 
  • Truva ensured they were aware of the many available options, and which would be the most wise given the prevailing winds of the regulatory environment.
  • In February 2020, engagements were signed and plan approved for the second stage.  Accommodating a necessary slowdown for lockdown, September 2020 became the target for the launch of a full-blown wholesale bond programme.

The launch of the dual-listed, A-rated Propifi bond

On 2 September 2020, Propifi launched its bond programme with all the features and benefits they’d long desired:

  • An A-rated bond
  • Issuance from a special purpose vehicle, Propifi Bonds plc
  • Listing on HMRC-recognised stock exchange: Frankfurt
  • Electronic settlement in CREST

To establish and administer the Propifi Bonds plc issuance, Truva Trustees provided:

  • Incorporation of an SPV as a public limited company
  • Share trustee services
  • Provision of directors
  • LEI application
  • Corporate administration of SPV
  • Structuring and transaction advice throughout
  • Recommendation of/introduction to the other necessary intermediaries in the structure
  • Legal services through GreenwoodsGRM LLP
  • Programme note trustee services
  • ISIN application
  • Note and security trustee services for the issued bonds
  • Listing of the bonds on the Frankfurt stock exchange with an application pending for the Oslo stock exchange

If you need a bond programme, or have one that needs a gap or two filled, please call us.

  • Please see here for example of Truva’s expansive transaction experience.