Punch Taverns has won the European Deal of the Year 2003 award from International Securitisation Report (ISR) for its debt restructuring.

The company completed the restructuring of its long term securitised debt finance in November last year. The refinancing of existing floating rate notes and the issuance of additional fixed rate notes took total securitised debt to £1.825 billion, all of which was investment grade rated.

The two securitised structures were merged and extended to include recent acquisitions. The new securitised structure covers 4,304 pubs and has total gross debt of £1.825bn, all of which is investment grade. The weighted average cash interest cost of the new structure is 7.2%. The structure is a mix of fixed and floating rate notes, which amortise fully by 2033. The interest cost of the floating rate notes is effectively fully fixed by virtue of existing hedge contracts.

ISR praised the deal for the benefit it brought to both the issuer and investors in its asset class.

“In the words of one investor:  ‘It takes the best of Punch Taverns and Punch II (the issuer’s previous transactions) and combines them.’

“The deal improved liquidity and provided a more simplified and transparent transaction structure. It is also the first time such a merging of two securitisations has been attempted – with the eye-wateringly complex negotiations that such a plan entails.”

Punch Taverns company secretary Neil Preston, who received the award at a ceremony at the Dorchester Hotel, said:

“This is fantastic recognition of all the hard work which went into this deal.”

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