Firms: Herbert Smith Freehills (Commonwealth Bank of Australia); Ashurst (arrangers and joint lead manager syndicate)
Deal: Commonwealth Bank of Australia has issued CommBank PERLS VIII and concurrent PERLS III Reinvestment Offer to raise funds.
Value: $1.25 billion
Area: Banking and finance
Key players: The HSF capital markets team was led by partners Philippa Stone, Philip Hart and Patrick Lowden, supported by senior associate Charlotte Cameron and solicitors Ben Robinson, Thomas Mawson and Jake Reynolds.
The Ashurst team was led by partner Sarah Dulhunty, with assistance from senior associate Andrew Kim and lawyer Andrew Johnston.
Deal significance: CBA is a provider of integrated financial services including retail banking, premium banking, business banking, institutional banking, funds management, superannuation, insurance, and investment and share broking products and services.
CommBank PERLS VIII Capital Notes are subordinated, unsecured notes. The proceeds from the issue will raise Tier 1 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 fund CBA’s business.
The issue of CommBank PERLS VIII Capital Notes under the Offer is expected to occur on 30 March 2016, with deferred settlement trading and normal settlement trading to occur on 31 March 2016 and 4 April 2016 respectively.
The Reinvestment Offer is an offer to eligible PERLS III Holders to sell all or some of their PERLS III to CBA for $200 per PERLS III on the Reinvestment Date (30 March 2016) and to automatically reinvest the sale proceeds in PERLS VIII.
Greenwoods & Herbert Smith Freehills are advising CBA in relation to Australian taxation.
HSF lead partner Ms Stone said: “We are delighted to be acting for our long-standing client, Commonwealth Bank of Australia, on its issue of CommBank PERLS VIII Capital Notes. It is encouraging to see the continued strength of the Australian hybrid market.”