Volta SKAI OÜ bond issue oversubscribed 2.2 times 

The €8 million secured bond issue of Volta SKAI OÜ, Estonian company operating under the brand of local real estate developer Endover, was oversubscribed 2.2 times. 112 investors participated in the offering with a minimum investment of €100,000, subscribing for bonds worth a total of €17.7 million. Due to high demand, it was decided to allocate bonds to 61 investors.

 

Volta SKAI OÜ conducted an over-the-counter public bond offering from September 17-26 with a minimum investment of €100,000. The issue was participated in by investment funds, asset management companies, bond funds and sophisticated retail investors from all Baltic countries.

“We are grateful for the investors’ trust. The more than two-fold oversubscription with a minimum investment of €100,000 confirms the strong interest of experienced and knowledgeable investors in Endover’s development projects. This is already the third successful issue this year for Endover’s subsidiaries, and we are pleased to see that a considerable number of repeat investors have emerged for our bonds,” said Endo Tõnuver, Chairman of the Board of Endover and owner of Volta SKAI OÜ.

“Due to high demand, it was not possible to satisfy all subscription applications. The total volume of the Volta SKAI bond program is planned to be €30 million together with subsequent funding rounds. Investors who were left out this time will have the opportunity to participate next time,” added Tõnuver.

The bonds are secured by a first-ranking mortgage on the Volta SKAI property at Krulli 10, Tallinn. 

The following allocation rules were used in distributing the bonds:

  • Previous investors in Endover subsidiaries’ bonds and institutional investors received 50% of the subscribed amount or at least €100,000
  • Estonian investors who subscribed for bonds worth at least €200,000 also received 50% of the subscribed amount
  • Estonian investors who subscribed for less than €200,000 were allocated €100,000 worth of bonds based on subscription time

According to Silver Kalmus, Head of Bonds at LHV Bank, the success of the Volta SKAI issue indicates investors’ interest in quality real estate projects and well-structured bonds. “The Volta SKAI issue confirms that bonds secured with a first-ranking mortgage from attractive development projects find strong investor interest. This is a high-rise with modern architecture being built in the heart of one of Tallinn’s most popular development areas. The 2.2-fold oversubscription of the issue reflects both the attractiveness of the Volta SKAI development project and investors’ trust in the developer,” added Kalmus.

Volta SKAI OÜ intends to apply for the bonds to be admitted to trading within six months after issuance and list the bonds on Nasdaq Tallinn’s alternative market First North. This will allow investors to trade the bonds on the secondary market.

The interest rate on the bonds is 10% per annum, interest is paid quarterly and the redemption date of the bonds is 2 years. The bonds are secured by a first-ranking mortgage on the Volta SKAI property at Krulli 10, Tallinn.

The capital raised from the bonds will be used to refinance existing obligations and to finance the construction of the first tower of the Volta SKAI high-rise. The project with two 12-story towers will become North Tallinn’s new landmark with panoramic views of Tallinn Bay and the Old Town. The development partner for the Volta SKAI project is Endover OÜ. According to plans, construction will begin at the end of this year.

The lead arranger of the issue is LHV Bank, co-arranger is Redgate Capital and legal advisor is law firm Ellex Raidla.