Hyprop replaces debts to appease Moody’s
Moody’s said in February it was concerned Hyprop would have to rely on external financing to cover R5bn worth of debt due in the next 18 month
Hyprop Investments, the owner of Rosebank Mall and Canal Walk, whose shares have fallen by about a fifth since its credit rating was downgraded in February, says it has replaced maturing debts worth R4bn.
Moody’s said in February that it was concerned that Hyprop would have to rely on external financing to cover R5bn of debts due in the next 18 months. Since that announcement, the property group’s shares have fallen 19.7% to R71.
Hyprop said on Tuesday it had refinanced R4bn of external debts by the end of March.
In mid-March, the group announced the issue of two new unsecured five-year notes under its domestic medium-term note programme. Those notes raised R500m at an average interest rate of 171.5 basis points above the three-month Johannesburg interbank average rate (Jibar), Hyprop said.
The proceeds would be used to redeem a R350m bond maturing in July, to fund investments aimed at improving the entertainment offerings at its malls, and to install new tenants where space occupied by the struggling Edcon group was being trimmed.
Hyprop said it had also signed agreements to refinance the debts of its UK-based business, Hystead.
“The refinancing and extensions … address a significant part of the debt underlying the concern cited by Moody’s in its decision to downgrade Hyprop’s credit and issuer ratings,” the group said.
Hyprop said it was working to refinance US dollar-denominated debts linked to its sub-Saharan Africa portfolio and its rand-denominated bonds due August and November 2019. “The group has historically been able to refinance its debt with no difficulties, and is confident of its ability to continue to do so.”