London Early Years Foundation
London Early Years Foundation (‘LEYF’) is a charitable social enterprise that provides high quality early years education to children across London. Its cross-subsidy model means that it can operate nurseries in areas that would not be attractive to for-profit nursery providers. The charity runs 39 nurseries across 12 boroughs in London including in some of the city’s most deprived wards.
The first five years of a child's life profoundly shape their future life outcomes, especially for those from disadvantaged backgrounds. Early years education and care is vital to building a solid and broad foundation for lifelong learning.
LEYF has grown significantly over the last 15 years and is now one of the country's leading social enterprises. In 2021, LEYF generated annual income of c. £22 million.
The bond offer
LEYF is seeking to raise £1.5 million as a first step in its long-term strategy that would more than double LEYF's existing portfolio. It will invest the money into new leasehold and freehold nurseries across the city.
LEYF bonds are eligible to be held in a Triodos
Innovative Finance ISA (IFISA). As with all ISAs, there are eligibility
criteria and you receive interest tax-free. ISA eligibility does not guarantee
returns or protect consumers from losing their money.
To invest in LEYF bonds through a Triodos IFISA,
select the ‘Invest through IFISA’ option. This selection will add to your
current year IFISA or will open a new IFISA if you haven’t previously opened
Transferring an existing ISA
If you want to invest by transferring an existing
ISA to a Triodos IFISA you must first request the transfer. You can do this
under ‘Account’ once you’ve become a registered user of the platform. Your ISA
London Early Years
7 years, repayable
on 31 May 2029
5% gross per year.
Payable in arrears on 31 May each year (paid net of UK basic rate tax unless
held in an IFISA). Payment of interest and repayment of capital are not
Although the standard interest rate is 5%, investors will be given the option to select 0% or 2.5% interest rate should they wish to forego part or all of their interest for the term of the bond.
LEYF has the right
to repay the bonds without penalty from 31 May 2025.
The bonds are
unsecured, which means that bondholders will rank equally with LEYF’s other
unsecured creditors and behind secured and preferential creditors on
A gearing covenant,
which places a limit on the Charity’s total borrowings. A breach of this
covenant triggers a higher rate of interest for the period of the breach. Two
consecutive breaches would be an event of default.
transferable but are not listed on any investment exchange which means that
bondholders will have to find a willing buyer and agree a purchase price with
them, which in practice may not be easy. Investors should be prepared
to hold the bonds for their full seven-year term.
£750,000. If less
than £750,000 is raised, monies will be returned to investors with no accrued interest.
Closes on 29 July 2022,
unless fully subscribed earlier or the offer is extended. Bonds are allotted 14
days after close and investors start to accrue interest from that
Capital at risk warning
Past performance is
not an indication of future performance. Capital is at risk and returns are not
guaranteed. Investors should read the offer document in full, including the
risks section, before deciding whether to invest.