Delegat's to make capital note offer

Tuesday 22nd June 2004

Winemaker Delegat's Group Limited is seeking to raise $35 million through a fully underwritten issue of unsecured, subordinated Capital Notes. The offer is part of a strategic funding programme which also includes plans for an equity issue next year.

The money raised will be used to meet the costs of the offer and to repay bank indebtedness. Repayment will, subject to satisfaction of conditions, release pre-arranged project funding for the staged construction of a winery in Marlborough and preliminary expenses associated with a winery in Hawke's Bay plus a working capital facility to support Delegat's Group's growth and expanded activities.

The notes will be for a term of just over three years maturing on 15 November 2007 and will carry an interest rate of 9.75% per annum.

The Offer opens on 28 June 2004 and will close on or before 23 July 2004. There is no provision to accept oversubscriptions. The minimum application for Capital Notes is $5,000 and thereafter in multiples of $1,000.

The lead manager and underwriter is Westpac Institutional Bank.

Prior to the maturity date Delegat's can elect to either: offer noteholders an opportunity to renew all of their capital notes from the maturity date on new terms and conditions; redeem the notes from the maturity date for cash; or convert the notes into ordinary shares in Delegat's at the relevant conversion rate.

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