Surrey Cricket Club experiences strong mini-bond demand to fund expansion of The Oval
3 min read
21 August 2015
London-based cricket team Surrey has banked £2m of commitments during the first two days of a fundraising effort to finance the redevelopment of two stands at its ground.
The club, based in Oval, London, is ultimately looking to bank £3.5m from what has been called the Surrey Country Cricket Club Bond – a fixed five-year term investment offering 5.5 per cent gross interest a year.
Despite club revenue from membership income, conferencing and events and matches improving during the last few years, the decision was made to utilise a funding method that is becoming increasingly popular.
Originally used by the likes of John Lewis and Hotel Chocolat, smaller businesses such as Mexican food chain Chilango, beer brand Innis & Gunn and The Eden Project have recently completed fundraisings.
A minimum commitment of £2,000 is required for the Surrey mini-bond, after which multiples of £1,000 can be invested up to a maximum of £250,000 for a single applicant and £500,000 for joint applicants. Although £3.5m was set as an initial target, Surrey has said that up to £5m may be issued to “satisfy demand”. Priority has been given to members of Surrey Cricket Club.
Richard Thompson, chairman of Surrey County Cricket Club, commented: “We are very pleased with the uptake of the bond so far, especially as it is currently exclusively open to Surrey County Cricket Club Members.
“It highlights the support that our members give the club which is crucial and has been through our 170 year history.”
Read more about bond offerings:
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- Crowdcube targets growing businesses with new mini-bond funding option
- Why Will King backs SME bonds
Back in May, English rugby club Wasps completed the world’s first bond fundraising for a sports team. The team raised £35m by way of a 6.5 per cent seven-year secured bond so that it restructure its balance sheet, pay down existing debt and acquire the Ricoh Arena in Coventry as a new home.
Wasps used the London Stock Exchange (LSE) as a platform for the mini-bond and was fully subscribed in a process which took a little over a week.
At Surrey, the money banked will be used to redevelop the Peter May and Lock Stands, taking the ground’s capacity up to 25,300. On top of that, spectator facilities will be “vastly improved” with additional catering units, toilets and undercover areas.
Members have sole access to the bond until Monday 14 September when it will be open up to the club’s wider supporter base.