Invest in a Credit-Linked Security linked to Dell, returning 6.00% p.a.
The information below is a summary of this investment opportunity. Investors must obtain and read the ‘Product Disclosure Document’ for this security dated 1 December 2022 (PDS), along with the ‘C2 Accumulator – Deferred Purchase Agreement – Master PDS’ dated 21 October 2022 (Master PDS Oct 2022) before investing in this opportunity.
Overview
Dell Technologies Inc provides computer products. The Company offers laptops, desktops, tablets, workstations, servers, monitors, printers, gateways, software, storage, and networking products. Dell Technologies serves customers worldwide. Dell is among the world’s leading technology companies from hybrid cloud solutions to high-performance computing to ambitious social impact and sustainability initiatives. Dell is a technology leader in most of the end markets in which it participates and is benefiting from a strong PC refresh cycle related to Covid-19. Dell is a listed global household name (NY Stock Exchange: DELL) with a market capitalisation of USD 32B. The security provides Investors with the opportunity to make an AUD investment, yet gain exposure to returns based on the credit risk of Dell (an opportunity usually available only to investors wishing to make a market-sized investment (USD 500,000) denominated in USD). All currency exposure has been fully hedged by the Issuer. By investing in this security, investors will receive regular income in the form of coupons and 100% of the face value of your investment on maturity – all in AUD.Barclays PLC Document
- C2 Accumulator – Deferred Purchase Agreement – Master PDS (October 2022);
- C2 Credit Linked Securities Series 2 – Dell Inc PDS
Marketing Documentation
Key Terms
| Issuer | C2 Specialist Investment Pty Ltd ACN 622 433 032 |
|---|---|
| Custodian | C2 Nominees Pty Ltd (ACN 624 366 981) |
| Arranger | C2 Financial Services Pty Ltd ACN 621 428 635 AFSL 502171 |
| Coupon | 6.00%pa (fixed), paid quarterly |
| Maturity Date | 20 December 2026 |
| Issue Price | $100 |
| Minimum Investment | $10,000 |
| ABE Code | C2DF060026 |
Risks
This is an overview of the main risks associated with this investment. Further (and more complete) details of the main risks associated with this security are set out in the PDS.
- Capital invested is at risk – There is no capital protection or guarantee by the Australian government or any other party (including the Issuer). Therefore, if the Issuer or Dell default, you may not receive the amount you have invested on maturity.
- Credit exposures to Dell – The return on this security incorporates a ‘credit transaction’ where the return is linked to the prices, levels, rates or contingencies related to a four year credit linked note (maturing on 28 December 2026) which is linked to a series of senior unsecured bonds issued by Dell in USD and paying 7.1%pa, maturing on 15 April 2028 (or an equivalent successor) (Dell Bonds). If Dell suffers a ‘credit event’ (eg bankruptcy, failure to make a payment in respect of the Dell Bond etc) (Credit Event), you may lose some or all of your investment.
- Credit Exposure to Issuer and any ‘Hedge Counterparty’ – In addition to the credit risks associated with Dell (as outlined above), investors also bear credit risk with respect to the Issuer and, indirectly, to any entity with whom the Issuer has entered into a contract to hedge its obligations under the security (Hedge Counterparty).
- Credit Rating – credit ratings do not constitute a guarantee of the quality of these ‘credit-linked securities’ of Dell. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the rating agency. Further, the rating agency may fail to make timely changes in credit ratings in response to subsequent events and, therefore, a credit rating may not fully reflect the true risks under is ‘credit-linked security’.
- Historical Performance – Historical performance of Dell or the Issuer are not an indication of their future performance.
- Liquidity risk – If you want to sell your securities before the Maturity Date, there may be a delay, or you may not be able to do so, or may not be able to do so within your desired timeframe.
- Extended Maturity – The Maturity Date may be extended in the case of a Credit Event or extension by the Issuer. If the Maturity Date is extended as a result of any Credit Event, coupons will not accrue beyond the original scheduled Maturity Date.
- Early Maturity -In certain circumstances the Issuer may elect to redeem these securities early (eg the Issuer reasonably determines that it may not be able to rely on the hedging contracts it has entered into with the Hedge Counterparty, you become bankrupt or insolvent etc);
- Custodian risk – The Custodian is a related party of the Issuer. There is a risk that the Custodian may be unable to perform its obligations under the Custody Deed and investors may not receive certain money when such amounts become due to them. However, the Custodian is a special purpose vehicle set up to act as Custodian for these types of securities and other structured products and has no other obligations.
Disclaimer: This webpage has been prepared by ABE Distribution Pty. Ltd ACN 673 177 912 (“ABE”). ABE is a Corporate Authorised Representative number 1307088 of Novus Capital Limited ACN 006 711 995 AFSL 238168. The information contained in it is of a general nature only. It was prepared without considering your financial needs, circumstances and objectives. Before investing in this security, you should consider whether it is appropriate for your circumstances and review the Master PDS and PDS. This website may contain links to other third-party websites, some of which require a subscription to read. Such links are for your convenience only, and ABE does not recommend or endorse these third-party sites. No representation or warranty is made as to the accuracy, completeness or reliability of any estimates, opinions, conclusions, or other information contained in this website. This website may contain certain forward-looking statements. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors, many of which are beyond our control. Past performance is not an indication of future performance. To the maximum extent permitted by law ABE disclaims all liability and responsibility for any direct or indirect loss or damage that you may suffer as a result of relying on anything on this webpage.