An unlisted corporate bond is a way for UK companies to borrow directly from the public. After the 2008 global financial crisis, the UK government recognised that banks did not have the money to lend to small and medium-size enterprises (SMEs). The government allowed UK SMEs to directly approach the public with a corporate IOU (or promissory note) called an unlisted corporate bond. The investor lends money to a UK plc for a set amount of time (the “Term”) in return for a fixed amount of interest (the “Coupon”) plus the original investment amount which is returned at the end of the Term.
Unlisted corporate bonds are effectively a private borrowing agreement between a company and an investor that cannot be transferred to someone else. In contrast, retail corporate bonds and government gilt-edged securities are freely tradeable instruments. The financial promotion of unlisted corporate bonds must be carried out by an FCA-authorised and regulated company to ensure the invitation to invest is fair, clear and not misleading. They are not protected by the Financial Services Compensation Scheme. While safeguards are in place, the FCA is very clear that every investor should be aware that their capital is at risk.
Why are you seeking investment via an unlisted corporate bond rather than going direct to the banks or considering other forms of investment?
An unlisted corporate bond is a cost-effective method of raising investment. Dealing with banks can be onerous and time-consuming, and would not give the Company the flexibility and agility it needs to make the most of market opportunities.
£1,000 is the minimum investment. You may invest in multiples of £1,000 thereafter, with no upper limit.
- certified high net worth investors (as per COBS 4.7.9R);
- certified sophisticated investors (as per COBS 4.7.9R);
- self-certified sophisticated investors (as per COBS 4.7.9R); or
- certified restricted investors (as per COBS 4.7.10R)
Regenerate London plc is the company that has been established to issue the Bond. It is a wholly-owned by AGRE and is part of the Affinity Group.
Sentient Capital London Ltd is authorised and regulated by the Financial Conduct Authority with FRN 679298 and has approved the Information Memorandum for the purposes of section 21 of the Financial Services and Markets Act 2000 (FSMA).
Regenerate London plc is the Registrar. Following the closure of the Offer Period of the Bond, it will maintain a record of each investor, including their details and investment amount.
Bonds are suitable for self-invested personal pensions (SIPPs), subject to approval by the scheme trustees and administrators. Unlisted corporate bonds are not currently approved for ordinary tax-free individual savings accounts (ISAs).
Once your application has been accepted, your investment will be recorded in your Bond Account. In addition, following the relevant Closing Date, all Bondholders will be issued with a bond certificate registering their investment.
Yes, provided you do so within 14 days of your completed Application Form being received or being submitted online. If you wish to cancel your application, you should write to Helpdesk, Regenerate London plc, 41/43 Brook Street, London, W1K 4HJ. After this date, your application will be irrevocable and you will not be able to terminate it or rescind it unless there are exceptional circumstances.
The invitation period opens on Launch Date and closes on the Close Date (please see the Bond Instrument, found in the Bond Terms and Conditions, that accompanies the Information Memorandum).
For the five-year term of the Bond, you are paid every calendar quarter a fixed interest of one quarter of the 7% annual interest from the time your funds have cleared.
All of your original investment is expected to be returned in full at the end of the Term of the Bond.
The Company will take no fees or make any deductions or charges of any kind on the interest paid by the Bond.
No, it is highly unlikely that there will be any correlation that is not statistically coincidental.
Unlisted corporate bonds have a fixed term and are not freely transferable. The Bond allows investors to request the return of their investment if they can show financial hardship or if an executor of their estate makes a formal request.
Any capital yet to be deployed may be held in the Company’s bank deposit account.
This does not mean that investments are safe or guaranteed. Investors will only receive their investment back if the Company has assets to realise in the event of default.
The Company believes it can deploy a minimum of £250,000 a month. The maximum raise over a series of bonds is currently anticipated to be £50 million.
Bonds that are not jointly held would form part of your estate and title would pass to the executors or administrators of your estate. The Bond allows your executors or administrators to apply for early repayment in order that the estate can be settled.