Starwood Capital, PennantPark plan TASE bond offerings

Two more US companies, Starwood Capital and PennantPark (Nasdaq: PNNT) are considering raising debt on the Tel Aviv Stock Exchange (TASE).

If Starwood Capital's planned offering goes ahead, it will take place in the second quarter of 2018 led by Leumi Partners and IBI Hapoalim, and it will attempt to raise up to $200 million (about NIS 700 million).

Tel Aviv Stock Exchange Photo: Eli Yizhar

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Starwood Capital is a large privately held investment company with assets of $55 billion under management and more than 3,400 employees. Since the company was founded in the early 1990s it has raised $43 billion. The company was founded by Barry Sternlicht who serves as chairman and CEO.

Starwood has activities in hotels (which merged several years ago with the Marriott chain), condominiums in the US, a portfolio of commercial assets, two mortgage companies and other real estate assets. The offering on the TASE will represent only a very small fraction of its assets.

Starwood's planned TASE offering would continue the wave of bond offerings by US real estate companies. The attraction for these US companies is lower interest rates than those available in the US. There are currently 30 such US real estate companies listed on the TASE that have raised debt in Israel totaling NIS 18 billion.

PennantPark is a non-banking finance and loan company, which plans to raise up to NIS 400 million on the TASE and dual list its shares. The institutional stage of PennantPark's offering should take place tomorrow at a maximum interest reflecting effective annual returns of about 5.15%.

PennantPark's bond is rated AA- by S&P Ma'alot with a stable forecast with the final repayment due in 2023. The company has a market cap of $450 million.

Founded in 2010, PennantPark's main business is in loans classified as medium sized.

Published by Globes [online], Israel business news - www.globes-online.com - on November 20, 2017