MOOREBANK REDEVELOPMENT FINANCING OPTIONS

MOOREBANK BRICK QUARRY REDEVELOPMENT
PROJECT TEAM
ESP
FINANCIAL
ADVISORY
SOPHIE MCLEAN
CFO

PAUL MCNAMARA
Managing Director
EMMA COSGROVE
Market Analyst
ESP
FINANCIAL
ADVISORY
FINANCING STRATEGIES
Presentation delivered to Boral by ESP
31 May, 2014

PROJECT GOALS
AND OBJECTIVES


BORAL VALUES
AND PHILOSOPHY


PROJECT
CONSTRAINTS


DEVELOPMENT OPTIONS


CUSTOMERS
SHARE-
HOLDERS
BORAL
STAFF
COMMUNITIES
EXCELLENCE
INTEGRITY
COLLABORATE
ENDURANCE
SALE AS IS


Quarry no longer a useful resource
Convert to liquid asset
- meet debts
- new ventures
Sale now does not reflect land's potential


In line with sustainability and community values
costly
sale does not reflect potential


REMEDIATE
AND SELL


REMEDIATE
AND DEVELOP


Redevelop to achieve highest and best use
- Boral already owns asset
- Use of other business arms
- Good market conditions


Enter a 3-way Joint Venture
Boral to contribute land, remediation, rezone, management costs
Capital contribution = rezoned land value + remediation/fill costs
LendLease and Stockland as parties to JV


CAPITAL
STRUCTURE


Expand core business
Environmental/Social responsibility
Minimise company risk
Maximise shareholder wealth


RATIONALE
DISTRIBUTION OF
CASH PROCEEDS
1. Boral receive preferred return of equity stake
2. Partners receive proportional cash proceeds until capital returned
3. Boral receive 15% return on invested capital
4. Remaining cash proceeds split between JV partners (refer to report)


100% debt financed
50% financial intermediary lending
50% unsecured bond
Minimised risk
Maximised shareholder wealth
Cash Neutral Funding


FINANCING
RISK MITIGATION
AND EXIT STRATEGY
FINANCING
Financial liabilities - shared risk
Balance between leverage and risk/rate of return
interest rate risk
Skill capacity