Allen & Overy advises Social Ventures Australia on social benefit bond issuance

Allen & Overy has advised Social Ventures Australia on an AUD7m (£4.3m) social benefit bond issuance for the funding of the UnitingCare Burnside Newpin Program, which works with Australian children living in foster care to return them safely to their families.

The social benefit bonds were issued to a combination of high-net-worth and institutional investors. The minimum investment in the bond was $50,000 and it has an investment return target of 10-12 per cent per annum depending upon the number of successful restorations of children from foster care.

The transaction marks Australia’s first-ever foray into social benefit bonds, which were pioneered in the UK, where investors fund the delivery of services intended to increase social outcomes.

In 2010, Allen & Overy also advised Social Finance on its social impact bonds, which also direct private sector money to fund public sector projects. In this case, the investment proceeds fund prisoner rehabilitation programmes in the UK, creating a financial return to the investors that is dependent on levels of recidivism in the prisoner group.

The Allen & Overy team acting on the social benefit bond issuance was led by Sydney-based partner Adam Stapledon, with support from Sydney-based senior associate James Abbott and associate Andrew Daidone.