Orchard Funding opens up bond to retail investors

Orchard Funding Group, an AIM-listed speciality finance company, has launched a bond that is open to both retail and institutional investors.

The company is looking to raise up to £20 million, including retained bonds, via the 6.25% bonds due 2027, issued by Orchard Bond Finance.

The deal represents the first UK retail bond since November 2021 and the first UK retail bond from a business with listed equity in over two years. The bond will also be Orchard’s first corporate bond as it seeks to diversify its funding.

Orchard Funding Group has been trading since 2002 and listed on AIM in 2015. The group has historically been active in the insurance premium finance market, the professional fee funding market and, more recently, other specialist lending markets including static caravan site fee lending, static caravan lending and property finance lending.

Ravi Takhar, Chief Executive of Orchard, said:

“Orchard has experienced sustained growth since its commenced trading in 2002 and especially since the business was listed in 2015. We have lent over £683 million and we have the support of Natwest and Toyota Financial Services, who are supporting our established lending and new product lines.  In order to diversify both our sources of capital and our product breadth, I am delighted to be launching what I hope will be the first of our corporate bonds on the London Stock Exchange.  When these bonds are free to trade, investors will have the option to invest in both the equity and debt of our business.”

Michael Smith, of Convexity Capital, the lead manager of the deal, said:

“Convexity is pleased to be launching this debut bond for Orchard Bond Finance PLC. I have arranged many successful retail bonds since the market opened in 2011 and it’s great to see this listed company launch this bond. Orchard’s debut bond is an important step for the business: it augments the Company’s existing banking lines, provides diversification and importantly, it’s longer-dated capital. This bond is also important for the wider UK capital markets as we move into post-Brexit world. It’s important that businesses of all sizes have access to the capital markets to facilitate growth – and there is nowhere more appropriate for a UK listed business to raise listed debt than on the London Stock Exchange.”