AUD$600 million debt successfully raised for BAC

Brisbane Airport Corporation Pty Limited (BAC) today announced a successful AUD$600 million debt raising which will be used to repay maturing bank facilities and fund capital expenditure and working capital.

In the US Private Placement market, AUD$400 million has been raised with AUD$150 million in 10-year, AUD$150 million in 12-year and AUD$100 million in 15-year fixed rate bonds. Coupons were 5.24% and 5.34% in US dollars in the 10 and 12 year issues and 8.25% in a 15-year Australian dollar issue.

In the Australian market, AUD$200 million 8-year BBB/Baa2 bonds were issued at a fixed rate of 8.03%.

BAC Chief Financial Officer, Tim Rothwell, said that he was delighted with the strong interest in both markets. Offers of more than AUD$1 billion were received in the US and interest in Australia was double the level finally issued.

“BAC was one of a number of companies that had raised funds this year in the USPP market. The market has a good knowledge of Australian corporates and interest in strong infrastructure and airport businesses, such as BAC,” he said.

The terms offered, out to 10 and 15 years, are not currently available in Australian bond markets. Lead arrangers were Commonwealth Bank of Australia and Credit Agricole Securities (USA).

Mr Rothwell said the eight year term in the Australian market, characterized by three to five year bonds, was the third longest duration this year at a competitive margin and was a further sign that the market here was maturing for corporates. Lead arrangers were Westpac and National Australia Bank.

The funds will be used to repay AUD$400 million of maturing bank facilities and fund capital expenditure and working capital over the next 18 months. BAC currently has borrowings of AUD$1.7 billion and expects to raise further funds in both markets in coming years to repay maturing credit wrapped bonds and fund future infrastructure investment.

BAC, which is advised by RBC Capital Markets, has a 50 year lease to 2047 over Brisbane Airport, with an option to extend for a further 49 years, is 81% owned by Australian superannuation and similar funds and is rated BBB by S&P and Baa2 by Moody's.