Dartington Hall Estate Bond plc

  • Coupon: 4.3% annually, paid 6 monthly
  • Term: 10 years
  • Security: The bond will be secured over the onward loan to the Trust, a registered charity
  • Trading: on NEX exchange

PROSPECTUS NOW AVAILABLE

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Dartington Hall Estate Bond plc

18th November 2018

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, TO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM) OR TO ANY NATIONAL, RESIDENT OR CITIZEN OF THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN OR ANY MEMBER STATE OF THE EEA (OTHER THAN THE UNITED KINGDOM)

Dartington Hall Estate Bond plc - Offer Overview

  • Company : Dartington Hall Estate Bond plc
  • Listing: NEX Growth Market
  • Offer Type: Property-Backed Secured Retail Bond Offering
  • Coupon Rate: 4.3% paid 6 monthly
  • Term: 10 years
  • Raising: Minimum raise £7.5m and £20m maximum
  • Closing: 30th November 2018

About Dartington Hall

The Dartington Hall Trust is a charity operating as a social enterprise and working to stimulate new thinking and action, particularly in the areas of the arts, social justice, learning and environmental sustainability.

  • It currently receives c.250,000 visits a year
  • 1,100 arts events reaching 100,000 people
  • In 1,200 acres of beautiful estate near Totnes, Devon
  • Buildings and land recently valued at £43m with potential uplift after gaining Local Plan allocation at £54m
  • 10,000 square feet of retail space
  • Home to c.170 progressive small enterprises

Dartington Trust has incurred operating deficits of c £1.8m a year as surpluses created by enterprise activities have not been enough to cover central and estate management costs and the costs of delivering charitable activities. The new management are now proposing to transform the trust so that it becomes a more financially stable business with a better long term future, in three broad phases.

www.dartington.org

 

Highlights
  • The Trust intends to issue £36m in bonds. This will be in up to three tranches as follows:
    →This first phase of the Bonds - £15m targeted, with a minimum of £7.5m and a maximum of £20m, issued in FY19 (2018/19).
    →£10m issued in FY20 (2019/20)
    →£11m in FY21 (2020/21)
  • The Dartington Hall Trust can offer investors the opportunity to participate in the retail issue, and potentially in the future issuance programme.
  • The bonds will be issued by a plc formed as a wholly-owned subsidiary of the Dartington Hall Trust, itself a Company Limited by Guarantee. Funds raised in the plc as an issuance vehicle will be lent on to the Trust.
  • The bonds are to be property backed: the loan from the plc to the Trust will be secured against unencumbered freehold property owned by the Trust. The bonds, through the auspices of a security trustee, will be secured against the intercompany loan to the trust.

Use of Proceeds
  • The anticipated proceeds of the proposed fundraisings are intended to cover a range of capital expenditure projects across Dartington’s estate. Of the total fundraising targeted, the Bond proceeds, together with proposed Senior Debt, an £8.3m planned development loan and £10m of proposed fundraising in 2019 are intended to be applied as follows:
    → Capital expenditure £26,900,000
    → Operating investment in key capacity building new posts, IT and digital infrastructure and estate maintenance over the first two years after the issue £800,000
    → Interest and bank and related finance charges for first 3 years £2,800,000
    → Contingency or carried forward to future project elements £3,800,000
    → Total = £34,300,000

Risks*
  • The trust has been loss-making, clearly any new strategy/turn-around is not guaranteed and presents risk.
  • Any changes to the property market present risk.
  • Legal risk exists should the government change laws/taxation relating to charitable trusts.
  • Negative publicity could adversely affect the Group’s brand, business, and revenue.
  • Key person risk exists in that the loss of members of the management team could impact on the business.
  • Assumed growth figures and future business is not guaranteed and could impact on profit assumptions.
  • Usual risks relating to initial retail bond offerings.
  • There is liquidity risk in that the bond may not trade frequently or in volume.

*Please note that these risks represent the judgement of Cornhill Capital, there may be additional risks represented in the prospectus

Conflict of Interest
  • Cornhill Capital are receiving remuneration for their participation in this fundraise

Important information

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