Ann: PROSPECT: AKC: Auckland Council opens retail

• Release Date: 08/10/12 19:01
• Summary: PROSPECT: AKC: Auckland Council opens retail bond offer
• Price Sensitive: No
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AKC
08/10/2012 17:01
PROSPECT

REL: 1701 HRS Auckland Council

PROSPECT: AKC: Auckland Council opens retail bond offer

Media release
8 October 2012

Auckland Council opens retail bond offer

Auckland Council will open its first retail bond issue for sale tomorrow as
it seeks to raise as much as NZ$175 million to fund investment in Auckland's
infrastructure.
The offer, which is for 6-year, fixed-rate secured bonds, closes on Friday 12
October 2012.

Auckland Council is seeking to raise up to NZ$125 million, though it may
accept up to NZ$50 million in oversubscriptions.

"Our first retail bond offer provides ratepayers and other retail investors
the opportunity to invest alongside institutional investors and banks in
Auckland's growth and see tangible outcomes from their investment. Auckland
Council is one of the best credit rated entities in the country," says Chief
Finance Officer, Andrew McKenzie.

"The offer is an effective and efficient way to raise debt to fund
infrastructure investment. When managed well, debt is a sensible way to fund
our new capital projects and achieve the goal of making Auckland the world's
most liveable city," he says.

The bonds, which will be issued for a term of six years (maturing 16 October
2018), carry a credit rating of AA from Standard & Poor's and Aa2 from
Moody's.

The minimum investment level is NZ$5,000, with multiples of NZ$1,000
thereafter.

The bonds form part of Council's overall borrowing programme to fund its
investment in the region that will benefit all Aucklanders for generations to
come, Projects funded by the borrowing will include improved public
transport, sports fields, new libraries and community facilities.

The interest rate will be finalised on Friday 12 October 2012 and will be the
aggregate of the applicable 6-year swap rate at that time plus a margin of
1.08 per cent per annum on that date.

Investors wishing to obtain an investment statement for this offer can
contact one of the lead managers:
- ANZ on ph: 0800 269 476
- Bank of New Zealand on ph: 09 375 1391
- go online to www.aucklandcouncil.govt.nz
They can also contact an authorised financial advisor.

The bonds are secured by a charge over the rates revenue of Auckland Council
and will rank equally with all other secured debt of Auckland Council. The
security is first ranking except to the extent that other security is
preferred by law (including security interests that may have priority under
the Personal Property Securities Act).
Application has been made to NZX for permission to quote the bonds on the
NZDX. However, the bonds have not yet been approved for trading and NZX
accepts no responsibility for any statement in this announcement. NZX is a
registered exchange, and the NZDX is a registered market, under the
Securities Markets Act 1988.

Council reserves the right to vary the closing day of the offer. Applications
for the bonds can only be made using the application form contained in the
Investment Statement.

The former Auckland City Council and Manukau City Council previously offered
bonds to retail investors prior to November 2010.

Ends

For further information, please contact;
Mark Butcher, Treasurer, Auckland Council
Ph: 09 375 3381
For media assistance, please contact:
Glyn Walters, Media and Public Affairs Manager
Ph: 021 278 6858
End CA:00228225 For:AKC    Type:PROSPECT   Time:2012-10-08 17:01:56