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ABSA CAPITAL ARRANGES R650M SECURED NOTE FOR BUSBY

PUBLISHED: 11 October 2011, BusinessLive

Absa Capital, the corporate and investment banking division of Absa Bank Ltd, has arranged R650 million in a five-year secured high yield note as part of a R2 billion DMTN programme for House of Busby (Pty) Ltd (Busby).

Busby is a leading vertically integrated wholesaler and retailer of an extensive range of clothing, footwear, eyewear, accessories, luggage and handbags bearing international brand names such as Guess, Aldo, Mango, Nine West and Forever New. 

The inaugural issuance of R650 million, in a five-year note, was sold exclusively to local investors and was significantly oversubscribed.  The note is not listed and is unrated.

"This transaction further cements Absa Capital's position as the leader in the high yield bond market in South Africa," said Stephen van Coller, Chief Executive of Absa Capital.

House of Busby is owned by management, Ethos Private Equity Fund V and Sphere Private Equity Fund 1. According to Ethos principal, Michael Jensen, Ethos is pleased to be announcing a second high-yield bond within its portfolio in the space of twelve months. 

"The local high-yield bond market continues to develop, and presents a viable alternative to offshore markets," said Jensen.

Busby CEO, Keith Brouze concluded: "The capital injection and flexibility of this issue, enables Busby to grow by executing on a strong pipeline of organic and new opportunities."

The proceeds of the issuance will be used to refinance and expand Busby's existing business.