Grafton Group hopes to raise at least £50m by offering bonds directly to retail investors. Chief executive Gavin Slark said the firm aims to diversify its funding and extend the maturity of its debts. Investec is managing the issue.
Grafton follows a growing number of companies taking their bonds straight to individual investors this year. The bonds will be issued by Grafton Group Finance and are guaranteed by Grafton and a certain number of its subsidiaries. The bonds bear a fixed interest rate of 5.5% per annum and will be payable semi-annually to holders on 15 January and 15 July each year.
The minimum initial investment is £2,000 and the bonds can be bought and sold at their face value of £1,000 plus increments of £100 in excess of £1,000 thereafter.
Mr Slark said: "The group is pleased to launch its first listed retail bond as part of its strategy of diversifying its sources of funding and extending the maturity profile of its debt."