AGL Energy diverts $300m debts
AGL Energy has announced that it has successfully diverted some of its debts to the American market as a part of its scheme to make the firm's debt maturity longer and to diversify its sources of financing.
The gas and electricity utility firm stated on Friday it had placed unsecured notes worth $US300 million in the private placement market of the US.
The financing will be sourced from tranches with 15 year and 12 year maturities for $A151.41 million ($US135 million) and $A185.06 million ($US165 million) respectively.
The tranches will be converted to $A338 million at basis points of 259 and 254 over the floating bank bill conversion rates of the Australian dollar.
As of December in 2009, AGL Energy had more than $500 million in debt.
Earlier in July, AGL Energy had stated intentions of buying out Mosaic Oil NL, the gas exploring firm, for around $130 million.
Stephen Mikkelsen, chief financial officer of AGL, said the firm was happy with its success regarding its first raising of debts in the American private placement market.
The debt transfer was about double oversubscribed.
"The transaction is consistent with our stated strategy of diversifying funding sources and lengthening debt maturities," Mr Mikkelsen remarked.
A utilities analyst who wished not to be named said it was refreshing to see AGL Energy effectively managing its capital.
"If you look at the terms of the debt, they are fairly good and the margins are reasonable," he said.
"The US PP (private placement) market has been fairly active of late.
"APA (Group Ltd) recently tapped it, Spark (Infrastructure Group) did as well, so it is fairly fertile funding ground," the analyst said.
The deal is subject to due diligence of the investor.
AGL Energy shares were up by one cent, trading at $14.89 at exactly 1027 AEST.