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Serco taps US private placement market

The company has raised £154mln through the issue of loan notes at a lower interest rate than its current loan notes, which are set to mature next year

Serco

Serco Group PLC (LON:SRP) has beefed up its balance sheet through the issue of US$200mln (£154mln) of US private placement loan notes.

The notes have maturities of 5, 7, 10 and 12 years, with a weighted average maturity of nearly eight years, the outsourcing outfit told investors.

The average interest rate on the new loan notes is fixed at 3.6%, which compares to a blended rate of 5.3% for the group’s existing loan notes, which are scheduled for repayment next year.

In a statement, Serco said: "A strong capital structure is essential in providing a base for the ongoing execution of our strategy.  We are therefore pleased to be able to secure long term debt at attractive interest rates. 

"This is the first time Serco has accessed the US Private Placement market in more than seven years and was possible due to our low financial leverage and resilient business model."

Quick facts: Serco Group

Price: 121.4 GBX

LSE:SRP
Market: LSE
Market Cap: £1.5 billion
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