SOUTH AFRICA – Life Healthcare Group Holdings Limited (Life Healthcare), a hospital group, has appointed RMB, the African Corporate and Investment Bank, as the sole lead arranger to establish a domestic medium-term note (DMTN) programme and to manage its inaugural bond issuance.

The programme is being arranged through the Company’s funding subsidiary, Life Healthcare Funding Limited (LHF), and is aimed at diversifying the Company’s South African funding base to include the institutional market.

The initial bond auction saw the issuing of R1 billion (US$57.93m) in notes, specifically R500 million (US$28.96m) in three-year notes and R500 million (US$28.96m) in five-year notes, and was oversubscribed 4.8 times, indicative of the significant institutional and bank interest.

“The healthcare industry has experienced volatility and strain over the past few years as a result of the Covid pandemic, and so we needed to ensure that LHF was able to access the right pockets of liquidity, at the right time, at the optimal price and do so without introducing undue finance risk,” said Leigh Buckley, Head Debt Capital Markets South Africa at RMB.

“The DMTN programme was the ideal domestic funding solution to help develop a new funding platform for Life Healthcare and a presence in the capital markets.” 

RMB and Life Healthcare have also successfully partnered on a syndicated hard currency term facility for the company’s international operations, where RMB was appointed joint coordinator, mandated lead arranger and bookrunner.

This partnership started with the inaugural syndicated loan initially in 2017 and the facility was successfully refinanced in 2020.

In addition, RMB has been co-mandated on the 2022 hard currency refinance of GBP183 million (~R3.7 billion) for the three-year tranche of the 2020 syndication.

This has provided RMB with the opportunity to demonstrate their extensive and in-depth understanding of Life Healthcare’s business having successfully achieved a 2.27x oversubscription across 13 local and international investors.

“The bond programme allows Life Healthcare to diversify its sources of funding for its growth aspirations and we are pleased with the support from the investment community at the inaugural bond issuance,” says Life Healthcare’s Group CFO, Pieter van der Westhuizen.

RMB partners Shoprite Group

RMB has partnered with the Shoprite Group through the provision of a R1.5 billion (US$86.89m) loan facility, to expand the retailer’s key environmental programmes as part of its wider sustainability strategy.

The loan facility consists of a R700 million (US$40.55m) green loan (a first for the retail sector) and a R800 million (US$46.34m) sustainability-linked loan, structured in accordance with Loan Market Association (LMA) green and sustainability-linked loan principles respectively.

“The Shoprite Group has identified key programmes such as energy efficiency and renewable energy, as part of their contribution to mitigating climate change which will have impacts across its value chain,” says Phil Norton, Transactor, Sustainable Finance and ESG Advisory at RMB.  

“RMB is proud to partner with the Group through innovative finance products linked to improved sustainability and environmental performance.” 

Proceeds raised from the green loan will be used to advance key initiatives including renewable energy, recycling of cardboard and plastic, sustainable packaging, and improved energy efficiency.

“These loans enable us to continue on the road to reduce our environmental footprint by using more renewable energy and sustainable packaging, and recycling more waste,” says Sanjeev Raghubir, Group Sustainability Manager.

“These environmental programmes are key to our fight against climate change, and we are able to increase the pace and intensity of our actions with these loans.” 

The Group’s record to date has provided funders with demonstrable evidence of the nature and scale of its sustainability project and ambitions, enabling the retailer to access a preferential cost of funding.

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