Channel Infrastructure considers bond offer

channelnz.com


NZX RELEASE
19 October 2023

Channel Infrastructure considers unsecured, unsubordinated, fixed rate bond offer

Channel Infrastructure NZ Limited (Channel Infrastructure) is considering an offer of up to $75,000,000
(with the ability to accept oversubscriptions of up to an additional $25,000,000 at Channel Infrastructure’s
discretion) of 6 year, unsecured, unsubordinated, fixed rate bonds (Bonds) to investors resident in New
Zealand and institutional investors.

If the offer is made, it is expected to open in the week beginning 30 October 2023, subject to market
conditions.

Channel Infrastructure has the right to redeem its subordinated notes which are quoted on the NZX Debt
Market under the ticker code CHI010 (Subordinated Notes) on 1 March 2024 (being the first scheduled
election date).

If the offer is made and the bookbuild is successful:

(a) subordinated noteholders that hold Subordinated Notes through a custodial account (and who wish
to apply for the Bonds) (Custodial Subordinated Noteholders) may be able to exchange all or
some of their Subordinated Notes for an equal number of Bonds on the issue date of the Bonds
(Issue Date) (on a one-for-one basis at a face value of $1.00); and

(b) Channel Infrastructure intends to issue a redemption notice in respect of the Subordinated Notes on
or before 16 January 2024 in order to redeem any Subordinated Notes on 1 March 2024 that are not
otherwise purchased under the exchange mechanism described above.

The exchange mechanism will only be available to a Custodial Subordinated Noteholder if:

(a) the Custodial Subordinated Noteholder receives an allocation of Bonds from a participant in the
bookbuild for the offer; and

(b) Channel Infrastructure and the relevant participant (acting on the authorisation of the Custodial
Subordinated Noteholder) have agreed to the exchange in respect of an agreed number of
Subordinated Notes.

If the offer proceeds, it is expected that a trading halt in respect of the Subordinated Notes would occur from
pre-market trading on the first trading day following the rate set date to close of trading on the Issue Date.
Channel Infrastructure will communicate with subordinated noteholders directly to notify them of the potential
offer and exchange mechanism (a template letter has been provided with this announcement).

Any Subordinated Notes purchased by Channel Infrastructure under the exchange mechanism will be
cancelled. This will reduce the total amount of Subordinated Notes outstanding which may impact trading of
the Subordinated Notes on the secondary NZX Debt Market.

Channel Infrastructure has appointed Forsyth Barr Limited as Arranger, and ANZ Bank New Zealand
Limited, Craigs Investment Partners Limited, Forsyth Barr Limited and Jarden Securities Limited as Joint
Lead Managers in relation to the proposed offer of Bonds.

channelnz.com


There is not expected to be any public pool for the offer, with all of the Bonds being reserved for clients of
the Joint Lead Managers, NZX Participants and other approved financial intermediaries.

Any such offer will be made pursuant to the Financial Markets Conduct Act 2013 as an offer of debt
securities of the same class as Channel Infrastructure’s existing quoted debt securities which are quoted on
the NZX Debt Market under the ticker code CHI020. The Bonds are expected to be quoted on the NZX Debt
Market.

Investors can register their interest by contacting a Joint Lead Manager (details below) or their usual
financial advice provider. Indications of interest will not constitute an obligation or commitment of any kind.
No money is currently being sought and no Bonds can be applied for or acquired until the offer opens and
the investor has received a copy of the terms sheet in relation to the Bonds.

For further information please contact:

Joint Lead Managers




0800 269 476 0800 226 263 0800 367 227 0800 005 678

-ENDS-

Authorised by:

Chris Bougen
General Counsel and Company Secretary

Contact details:

Investor Relations contact:
Anna Bonney
investorrelations@channelnz.com

Media contact:
Laura Malcolm
communications@channelnz.com


About Channel Infrastructure 

Channel Infrastructure’s vision is to be a world-class infrastructure company, delivering resilient infrastructure
solutions to meet changing fuel and energy needs.

Channel Infrastructure’s assets are a critical part of the Northland and Auckland fuel supply chain, supplying
around 40% of New Zealand’s transport fuel demand and all of the jet fuel to the Auckland International Airport. 
Utilising the deep-water harbour and jetty infrastructure at Marsden Point, as well as 280 million litres of storage
tanks, and the 170-kilometre pipeline from Marsden Point to Auckland we receive, store, test and distribute
fuel owned by our customers.  Channel Infrastructure’s wholly-owned subsidiary, Independent Petroleum
Laboratory Limited, provides fuel quality testing services at Marsden Point and around New Zealand.   

Channel Infrastructure will seek to support New Zealand’s decarbonisation ambitions, by utilising our
strategically-located assets and our expertise in supply chain infrastructure. The Company remains focused
on its future growth opportunities at the Marsden Point site and beyond, including additional fuel storage to
support fuel security and studies underway with partners on hydrogen and sustainable aviation fuel
opportunities.

---

channelnz.com



19 October 2023

Dear Noteholder,

We are writing to you as a holder of existing Channel Infrastructure NZ Limited (Channel Infrastructure)
subordinated notes which are quoted on the NZX Debt Market under the ticker CHI010 (Subordinated
Notes). The terms and conditions applicable to your Subordinated Notes are set out in the Master Trust
Deed dated 20 November 2018 (as amended on 27 June 2019).

Proposed offer of Bonds

Channel Infrastructure announced today on 19 October 2023 that it is considering an offer of up to
$75,000,000 (with the ability to accept oversubscriptions of up to an additional $25,000,000 at Channel
Infrastructure's discretion) of 6 year, unsecured, unsubordinated, fixed rate bonds (Bonds) to investors
resident in New Zealand and institutional investors.

If the offer is made, it is expected to open in the week beginning 30 October 2023, subject to market
conditions.

Redemption of Subordinated Notes on the first election date (1 March 2024) if the offer is
successful

If the offer is made and the bookbuild is successful, Channel Infrastructure intends to issue a redemption
notice in respect of the Subordinated Notes on or before 16 January 2024 in order to redeem any
Subordinated Notes on 1 March 2024 (being the first scheduled election date) that are not otherwise
purchased on the issue date of the Bonds (Issue Date) under the exchange mechanism described
below.

Channel Infrastructure will publish the notice of redemption via NZX and also email or, as applicable,
post you a copy.

Exchange mechanism

If the bookbuild for the offer is successful, those that hold Subordinated Notes through a custodial
account (and who wish to apply for the Bonds) (Custodial Subordinated Noteholders) may be able
to exchange all or some of their Subordinated Notes for an equal number of Bonds on the Issue Date
(on a one-for-one basis at a face value of $1.00).

The exchange mechanism will only be available to a Custodial Subordinated Noteholder if:

(a) the Custodial Subordinated Noteholder receives an allocation of Bonds from a participant in the
bookbuild for the offer; and

(b) Channel Infrastructure and the relevant participant (acting on the authorisation of the Custodial
Subordinated Noteholder) have agreed to the exchange in respect of an agreed number of
Subordinated Notes (Exchanged Subordinated Notes).

Channel Infrastructure will purchase the Exchanged Subordinated Notes on the Issue Date (rather than
redeem them on 1 March 2024 as described above under the heading "Redemption of Subordinated
Notes on the first election date (1 March 2024) if the offer is successful").

channelnz.com

Channel Infrastructure will satisfy its obligation to purchase the Exchanged Subordinated Notes on the
Issue Date by:

(a) issuing Bonds to the relevant custodian (that maintains the custodial account on behalf of its
Custodial Subordinated Noteholder participating in the exchange mechanism) equal in number
to the Exchanged Subordinated Notes purchased from the relevant custodian (on a one-for-
one basis); and

(b) paying a final interest payment on the Exchanged Subordinated Notes for the period from (and
including) the previous interest payment date for the Exchanged Subordinated Notes (1
September 2023) to (but excluding) the Issue Date.
No additional amounts are payable by a Custodial Subordinated Noteholder for any Bonds that are
issued under this exchange mechanism. Channel Infrastructure's obligation to purchase the Exchanged
Subordinated Notes will be satisfied once it has issued the relevant number of Bonds and paid the final
interest payment referred to in paragraph (b) above.

Any Exchanged Subordinated Notes purchased by Channel Infrastructure under the exchange
mechanism will be cancelled. This will reduce the total amount of Subordinated Notes outstanding which
may impact trading of the Subordinated Notes on the secondary NZX Debt Market.

For the avoidance of doubt, the exchange mechanism does not restrict:

(a) a Custodial Subordinated Noteholder from seeking to invest in more or less Bonds under the
offer than the number of Subordinated Notes beneficially held by the Custodial Subordinated
Noteholder; or

(b) any other subordinated noteholder (that is not a Custodial Subordinated Noteholder) from
seeking to invest in the Bonds.
If the offer proceeds, it is expected that a trading halt in respect of the Subordinated Notes would occur
from pre-market trading on the first trading day following the rate set date to close of trading on the
Issue Date.

Any Bonds not settled under the exchange mechanism must be cash settled on the Issue Date.

If you hold Subordinated Notes directly (i.e. not through a custodial account) and you are interested in
applying for the Bonds under the exchange mechanism described above if the offer proceeds, you
should contact a Joint Lead Manager (details below) or your usual financial advice provider.

Offer information

There is not expected to be any public pool for the offer, with all of the Bonds being reserved for clients
of the Joint Lead Managers, NZX Participants and other approved financial intermediaries.

Accordingly, if the offer is made and you are interested in investing in the Bonds (including under the
exchange mechanism described above), you can register your interest in the offer by contacting a Joint
Lead Manager (details below) or your usual financial advice provider.

Indications of interest will not constitute an obligation or commitment of any kind. No money is currently
being sought and no Bonds can be applied for or acquired until the offer opens and the investor has
received a copy of the terms sheet in relation to the Bonds.

Any such offer will be made pursuant to the Financial Markets Conduct Act 2013 as an offer of debt
securities of the same class as Channel Infrastructure's existing quoted debt securities which are
quoted on the NZX Debt Market under the ticker code CHI020. The Bonds are expected to be quoted
on the NZX Debt Market.

channelnz.com


Registrar

Computershare Investor Services Limited
Private Bag 92119
Victoria Street West, Auckland 1742
Telephone: 09 488 8777
Email: enquiry@computershare.co.nz


Joint Lead Managers




0800 269 476 0800 226 263 0800 367 227 0800 005 678