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Introduction

In April 2006, Aspire Defence Finance PLC, which acts as the financing conduit for the group, issued two series of Guaranteed Secured Bonds due 2040 totalling £1.463 billion (excluding £230 million of Authority Variation Bonds and £75 million of Rescue Variation Bonds which were subsequently cancelled).

Both series carry a coupon of 4.674% and have identical terms, save that Series A is guaranteed by Ambac Assurance UK Limited and Series B is guaranteed by Assured Guaranty (Europe) plc. The prospectus dated 31 March 2006 contains detailed information regarding the Bonds and the Project.

The Series B bonds were originally guaranteed by MBIA UK Insurance Limited, which was acquired by the Assured Guaranty group in January 2017 and renamed Assured Guaranty (London) plc (“AGL”).  In November 2018 the Assured Guaranty group announced AGL’s portfolio and operations, and those of two other European Assured Guaranty subsidiaries, were merged with and into those of Assured Guaranty (Europe) plc (“AGE”). As a result, all obligations and bonds insured by AGL are now insured obligations of AGE.

Assured Guaranty (Europe) plc has a AA rating from Standard & Poor’s and a A2 rating from Moody’s.  Ambac Assurance UK Limited is not rated.

Both Ambac and Assured Guaranty make extensive financial disclosures which can be obtained at www.ambac.com  and www.assuredguaranty.com respectively.

Reporting & Assessment

Aspire Defence regularly reports to Ambac, Assured Guaranty and rating agencies on the Project’s progress, and provides certain certifications to the Bond Trustees. Copies of the annual certification and reports have also been made available here to debt investors.

Standard & Poor’s currently assess the Project’s underlying credit rating as A- (Stable).  When the Bonds were issued in 2006 the underlying rating was assessed by Standard & Poor’s as BBB- (Stable).  It was increased to BBB (Stable) in March 2010, BBB+ (Stable) in April 2011, BBB+ (Positive) in May 2012, and A- (Stable) in April 2014. Periodic updates to their analysis can be obtained from www.standardandpoors.com.

Moody’s have assessed the Project’s underlying credit rating as A3 (stable).  When the Bonds were issued in 2006 the underlying rating was assessed by Moody’s as Baa3 (Stable).  It was increased to Baa2 (Stable) in October 2009 and the outlook changed to Positive in April 2012.  The rating was increased again to Baa1 (positive) in April 2013 and to A3 in February 2015.  Periodic updates to their analysis can be obtained from www.moodys.com.

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