London - Leading global law firm Mayer Brown has advised the UK’s leading regeneration specialist, St. Modwen Properties PLC, on the launch of an offering of £100 million of Guaranteed Convertible Bonds due 2019.

The Convertible Bonds were issued by a "cash box" company, St. Modwen Properties Securities (Jersey) Limited, and are convertible, during certain defined conversion periods, into preference shares of the Issuer which are automatically and mandatorily exchangeable for fully paid ordinary shares of St. Modwen. The terms of the Bonds provide St. Modwen, at its discretion, with the right to meet its exchange obligations to Bondholders by delivering ordinary shares, a cash amount equal to the value of the ordinary shares or a combination of both. St. Modwen is acting as guarantor of the Convertible Bonds.

The offering of the Bonds forms part of St. Modwen's wider financial strategy to diversify debt funding sources for its group, lower debt costs and extend maturities, taking advantage of current favourable market conditions. The net proceeds of the offering will be used to refinance existing bank debt.

It is intended that an application will be made for the Bonds to be listed on a recognised stock exchange prior to its first interest payment date (expected to be 6 September 2014).

Kate Ball-Dodd, Corporate & Securities partner at Mayer Brown, commented: "We are delighted to have advised such an important, long-standing client of the firm on its debut convertible bond."

James Taylor, Banking & Finance partner at Mayer Brown, added: "Against the backdrop of an increasingly uncertain interest rate environment and growing equity market volatility, the convertible bond asset class is being seen as an attractive proposition for fixed income and equity investors alike – we are delighted that St. Modwen was able to diversify its sources of funding on attractive terms through this offering."

The Capital Markets team at Mayer Brown was led by Corporate & Securities partner Kate Ball-Dodd and Banking & Finance partner James Taylor. They were assisted by Banking & Finance partner Robert Flanigan; Tax Transactions & Consulting partner Sandy Bhogal and senior associate Benjamin Fryer, and Corporate & Securities senior associate Michelle Wyatt.

Last year, Mayer Brown also advised St. Modwen on its placing of approximately 20 million new shares, raising approximately £49 million. The funds from the placing were raised to enable St. Modwen to exploit the potential of the development at the New Covent Garden Market in Nine Elms, the UK’s biggest fruit, vegetable and flower market without the need to increase the debt leverage on the Company’s balance sheet.