SYGNUS Capital Limited has successfully raised $4.3 billion by way of a private placement of bonds for its sister company Sygnus Credit Investments (SCI), which listed on the Main Market on the Jamaica Stock Exchange.

Sygnus Capital, which is a subsidiary under the Sygnus Group, the Caribbean’s leading alternative investment platform, acted as lead arranger on the capital raise while Scotia Investments Jamaica Limited acted as co-arranger for the transaction. SCI is a pioneer in private credit investment within the Caribbean.

The bonds were issued under the Financial Services Commission’s exempt distribution guidelines and were structured in three series across three tenors of 9 months, 2 years and 5 years. The proceeds from the private placement will be used to finance the growth of SCI’s investment portfolio, which boasts a very robust pipeline of opportunities across the region.

This raise was a part of SCI’s growth strategy to increase its scale and dry powder whilst further enhancing shareholder value by the efficient employment of leverage. SCI recently obtained an investment grade rating from Caribbean Information and Credit Rating Services Limited (CariCRIS), fulfilling its promise made to shareholders for SCI to become a rated entity at close to US$100 million in portfolio value.

SCI was assigned a stable outlook on the ratings with the expectation that it will remain profitable and adequately capitalised in the near future.

Bonds were oversubscribed by 29%

Backed by the company’s continued strong financial performance and the recently acquired credit rating there was an overwhelming demand for the bonds, which resulted in the issue being oversubscribed by approximately 29%. Gregory Samuels, senior vice-president and head of investment banking at Sygnus, was pleased to have led another successful capital raise for SCI this year.

According to him, “This time around we decided to use a multi-tranche dual-currency bond structure that was rated by CariCRIS. This structure provided institutional and high-net worth investors the option to participate at various points along the yield curve given their investment horizon and outlook.”

He pointed out that, “The structure also provided SCI the flexibility to have a natural currency hedge and duration matching its portfolio assets and liabilities; and the investment grade credit ratings (jmBBB) received from CariCRIS allowed the firm to get very attractive pricing on the issue. So, we see this as a win-win for all parties involved.”

For his part, Jason Morris, executive vice-president and chief investment officer at Sygnus, remarked that, “This record debt capital raise represents a major milestone in SCI’s history, coming on the back of its investment grade corporate credit rating. The new capital will provide an opportunity for the company to transition its private credit business to a larger operating scale and break into new territories across the Caribbean region.”