Centrus advises Onward Homes on a new £90m unsecured RCF

Transaction Overview

Onward are a leading provider of quality, affordable homes for rent and sale in the North West. From Southport to Stockport, the housing association owns and manages over 35,000 homes right across the region.

The housing association plans to build 500 homes a year whilst continuing to invest into existing homes. Onward’s successful bid to become a Homes England Strategic Partner in late 2021 accelerated this programme and increased liquidity requirements.

A new £90m RCF was required to meet this goal – with security being prepared to support the issuance of retained bonds and on-going challenges with local searches an unsecured solution was preferred, subject to cost.

Centrus Solution

  • Centrus provided early assurance to board on the potential viability of an unsecured facility.
  • We led development of a best-in-class information memorandum to support efficient lender credit assessment processes.
  • Advised on which lenders to target, how to position key mechanical / covenant requirements, and ensured initial terms were optimised.
  • Evaluated and negotiated the initial terms to ensure effective governance and the best possible outcome.

Added Benefits

  • Centrus identified the right lenders, maximised competitive tension, and enabled very strong initial bids.
  • With a number of attractive bids, we were then able to further tighten pricing whilst protecting covenants.
  • In initial documentation we ensured the unsecured mechanics where user-friendly and efficient, creating a template for future use.
  • The resulting outcome is a cost-efficient, flexible liquidity facility.

“Security is time-consuming and costly to put in place so our new unsecured RCF is a key part of our treasury strategy. John and the Centrus team supported this process throughout: from strategy through to final documents and Onward greatly benefited from Centrus’ treasury expertise and thorough understanding of our business. Their market engagement was excellent and I’m delighted with the outcome.”

Mike Gerrard, Executive Director of Finance – Onward

“This transaction has advanced the availability and attraction of unsecured finance for the whole sector. It also reflects the value in the holistic relationship between Centrus and Onward; from strategy development, through market testing, to close, Centrus’ insight into Onward’s business and requirements and what the market can offer have underpinned this successful outcome.”

John Tattersall, Senior Director – Centrus

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