Ann: Evolution Secures Full Ownership of Ernest Henry, page-57

Not dilution...

US Private Placement (“USPP”) market is a US private
bond market which is available to both US and non US
companies. The principle attraction of this market is that it
provides an alternative source of liquidity from the traditional
bank market without the need for a formal credit rating and
reporting requirements which are a pre-requisite of the
public bond markets.

There are around 50 active investors – mainly US insurance
companies. Although this market is small in comparison to
the public bond market, it is very flexible in terms of size of
issue ranging from less than $100m to up to $1bn (under
normal market conditions). Total capacity for a strong
investment grade company would be in the region of $1.5bn.
The USPP market typically provides fixed rate US dollar
debt in tranches of between three and 15 years though
longer maturities are available for certain issuers. Pricing is
typically at a small premium to the public bond market, to
reflect the private nature of the instrument, although there
are companies for whom pricing is similar in both markets.
One of the main attractions from an investor’s perspective is
that USPP’s usually come with covenants similar to those in
a company’s bank credit facilities.

The USPP market has proved to be resilient in recent
years and was largely open throughout the period of financial
turmoil in 2008/2009.