THE Exeter Chiefs have unveiled plans for a bond issue in a bid to finance the next phase of development at Sandy Park.
Exeter Rugby Group, incorporating the club and the conference centre, is hoping to woo investors by paying seven per cent interest – a move which will cost £525,000 a year for the next seven years.
The stadium is due to be enlarged from its current capacity of 10,744 to 20,600, starting with an extension to the West Grandstand and expansion of the conference centre to create a venue capable of hosting more than 1,000 delegates.
Work on enlarging the ground was originally expected to begin this summer but has now been put off until at least next year.
The stadium – which the Chiefs moved to in the summer of 2006 – is due to host three Rugby World Cup matches in autumn 2015. Before then its capacity needs to be raised to 12,300.
The first phase of works was expected to be funded through the sale of preference shares – known as P shares – in the business. But the Chiefs went back to the drawing board after failing to attract sufficient interest in the share issue.
Now a new Exeter Chiefs 2020 Bond has been launched with the aim of raising the £7.5m needed for the next phase of Exeter Rugby Group's long-term development plan for Sandy Park.
It is open to all investors, with a minimum subscription of £1,000 and a maximum of £4m.
Interest will be paid bi-annually in two equal instalments. The seven-year bond will mature in 2020 and cannot be transferred or redeemed early.
Tony Rowe, chairman and chief executive of Exeter Rugby Group, said: "Sandy Park is a great asset for the South West and Premiership Rugby, being a leading regional conference centre and a 2015 Rugby World Cup host stadium.
"We are very proud of what has been achieved on and off the pitch at Sandy Park over recent years and it has been a testament to all those involved at the club – members, employees, supporters and sponsors.
"As we enter the next stage of the group's development, we hope the release of the Exeter Chiefs 2020 Bond will provide the necessary funds to enlarge and improve the facilities at Sandy Park."
He added: "Our aim remains to make Sandy Park the leading sporting, conferencing and banqueting facility in the region."
Prydis Wealth Ltd, Michelmores LLP and Isca Ventures have advised Exeter Rugby Group on the bond issue.