Kofola Group – bonds issue in CZK

Kofola S.A. successfully completed its first bond issue on the Czech financial market, issuing bonds in total value of 330 million CZK. This was the first issue carried out by Polish listed company on the Czech financial market. The bonds are issued for a period of 60 months, with a margin of 4.15% over 12M PRIBOR.

For many years, Kofola is known to be one of the most admired companies on the Czech market and the issue addressed to the local investors enabled to turn the positive image of the company to the lower cost of financing compared to Poland. Issue of bonds has been done in good time when the Czech investors had a liquidity surplus and felt the lack of good projects for investing. The five-year coupon yield will be about 200 basis points lower than the current margin on three-year bonds issued in December 2011 in Poland.

In addition to lowering the cost of financing the new issue will allow the company to diversify the Group's sources of funding, extending the funding profile, and will protect the company from the announced changes to pension funds in Poland. Due to the uncertainty about the future of investment policy of pension funds it could be difficult to roll over the existing bonds. Our three year bonds are due in December 2014 and we are not sure whether it would be possible to roll over the bonds to the next period – said Bartosz Marczuk, CFO of Kofola S.A. The structure of the investors of the new issue in the Czech Republic includes both insurance companies, banks and asset management companies and chosen clients of private banking – thanks to this we will be independent of what will happen to the pension funds in Poland - he adds.

Another argument in favor of the issue of bonds in CZK is a natural hedge at the parent company level, which gets most of the revenue also in CZK.

Due to the private nature of the issue, the par value of one bond exceeds 100 thousand EUR and has been set at 3,000,000 CZK (about 0.5 million PLN).

Bonds have been conditionally admitted to the regulated market of Prague Stock Exchange and their debut is scheduled on 7 October 2013.

PPF banka a.s. and Česká Spořitelna, a.s. acted as the joint lead managers of the bond issue with PRK Partners s.r.o , attorneys-at-law acting as the legal advisor.