Firms: Freehills (Commonwealth Bank of Australia), King & Wood Mallesons (joint lead managers)
Deal: CBA issue of PERLS VI and concurrent PERLS IV reinvestment offer
Value: Approximately $750 million (with the ability to raise more or less)
Key players: The Freehills team was led by partner Philippa Stone and included partners Fiona Gardiner-Hill and Patrick Lowden, executive counsel Lauren Magraith, senior associates Phillip Hart, John Natal, Lisa Cuman and Lucy Hall, and lawyers Tom Cooper, Zain Kazi and Charlotte Cameron. The KWM team was led by partners Shannon Finch and Mark McFarlane and assisted by Senior Associates Pola Collins, Paul Mayson and Solicitor Nilofar Ali.
Deal significance: PERLS VI are perpetual, exchangeable, re-saleable, listed, subordinated, unsecured notes. The proceeds from the issue will raise Tier One Capital to satisfy CBA’s regulatory capital requirements and maintain the diversity of CBA’s sources and types of funding. The net proceeds of the offer will be used, to the extent necessary, to refinance PERLS IV and otherwise fund CBA’s business.
Freehills worked closely with CBA’s team, including group treasurer Lyn Cobley, head of capital and regulatory strategy Tricia Ho-Hudson and senior legal counsel Mark Alexander. Greenwoods & Freehills advised CBA in relation to taxation.
The arrangers for the offer were Commonwealth Bank of Australia and Morgan Stanley Australia Securities Limited, and the joint lead managers were ANZ Securities Limited, Commonwealth Bank of Australia, Goldman Sachs Australia Pty Limited, Macquarie Capital (Australia) Limited, Morgan Stanley Australia Securities Limited, RBS Equity Capital Markets (Australia) Limited and Westpac Institutional Bank.
“We are delighted to have had the opportunity to assist CBA on the PERLS VI raising, which will be the first fully Basel III compliant hybrid offering by an Australian bank and one of the largest hybrid offers in the Australian market this year,” said Stone.