Our judges named consumer goods group Reckitt Benckiser as winner of the UK Large Treasury Team of the Year category for 2017. A wide range of fundraising, transaction and post-deal integration work, all carried out to the highest standards of professionalism and attention to detail, impressed the judges.
Reckitt, which has shown substantial long-standing support for the ACT and its qualifications, and is an ACT CPD-accredited employer, has a team of 12 treasurers covering some 160 countries.
In the first half of 2017, the team excelled in executing the financing for the acquisition of US-listed food group Mead Johnson Nutrition.
The 100% debt-financed transaction was valued at some $18bn, and comprised a classic acquisition financing facility followed by a very rapid $7.75bn of bridge financing in the US bond markets, via a US 144A bond takeout with euro and sterling, and risk management optionality available.
Reckitt’s treasury team was described as high energy with a strong focus on detailed preparation, as well as a refusal to compromise on performance
The bond takeout was announced the day following the acquisition completion in order to term-out bridge financing.
Reckitt’s treasury team achieved good pricing on its 10-year tranche, a repricing of the secondary curve of existing bonds by between 10-18bps and left investors with up to 2bps versus a reoffer in the days following settlement.
In addition, the team was ready to access euro and sterling markets as needed.
Within three months, the team was again called into action with the sale of Reckitt Benckiser’s food business for some $4bn, and a subsequent deleveraging of the group.
The financing was regarded as having groundbreaking terms and structure, and the bond takeout, followed rapidly by the sale of the group’s food division, was a textbook example of M&A financing.
The cherry on the cake was the rapid integration of Mead Johnson Nutrition into the London-listed company’s core operations. Reckitt’s treasury team was described as high energy with a strong focus on detailed preparation, as well as a refusal to compromise on performance.
The team continually challenged and pushed banks and other advisers to deliver the highest possible standards and outcomes for Reckitt Benckiser, resulting in best-in-class terms that directly benefited the acquisition.
“For its strong focus on efficiency, pricing and process, Reckitt Benckiser is the worthy recipient of Large Treasury Team of the Year 2017.”
The treasury team at mining giant Rio Tinto passed some significant milestones in 2017 and successfully completed a major reorganisation plan to better serve the group under a new operating model.
London-listed Rio, an ACT CPD-accredited employer, found treasury to be instrumental to its group strategy when it announced $8bn of cash returns to shareholders during the year. This comprised $4bn of dividend payments and $4bn in share buybacks.
Treasury was the driving force behind both origination and execution of the share buybacks, including an off-market buyback of the Australian side of the dual-listed group, at a 14% discount to market value.
Significantly, during the year, a comprehensive review of how treasury delivers value to the Rio Tinto group was conducted, redefining the very purpose of the function by making explicit its mandate to partner the business in value creation and to lead technological transformation within treasury.
The changes included a move from London to Singapore of all global treasury dealings and operations in less than six months. This included FX and interest rate execution, cash management and investments, as well as back-office activities.
An expanded risk management team was also created with a clear mandate around improving risk analytics to support value-driven decisions.
The Treasurer's Deals of the Year Awards recognise the outstanding work of treasurers, both within the treasury community and the wider business world. Through them we champion the success and achievements of treasury teams that have stood out in the market over the prior 12 months. Winning an award is a great way to strengthen your organisation's and your treasury's profile, bringing peer and industry acknowledgement. Find out more here.