{"id":659524,"date":"2013-05-22T04:40:30","date_gmt":"2013-05-22T08:40:30","guid":{"rendered":"http:\/\/www.pehub.com\/?p=203674"},"modified":"2013-05-22T04:40:30","modified_gmt":"2013-05-22T08:40:30","slug":"reuters-alinta-plans-debt-raising-in-us","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/659524","title":{"rendered":"Reuters \u2013 Alinta Plans Debt Raising in US"},"content":{"rendered":"

Alinta Energy<\/strong> is planning a $1 billion-plus debt issue in the U.S. term loan B institutional market to refinance maturing debt, writes Reuters. Alinta is owned by TPG Capital<\/strong>.<\/p>\n

Reuters<\/em> – Private equity-controlled power firm Alinta Energy is planning a $1 billion-plus debt issue in the U.S. term loan B (TLB)institutional market to refinance maturing debt, banking sources familiar with the deal said, joining a growing number of Australian borrowers attracted by the terms and pricing available.<\/p>\n

Alinta, controlled by U.S. buyout giant TPG Capital , is carrying A$1.2 billion ($1.17 billion) in senior term loans, an A$400 million super senior loan, as well as interest rate swaps of around A$210 million on a marked-to-market basis, according to the sources.<\/p>\n

The sources declined to be identified because of the sensitive nature of the deal. Alinta’s spokeswoman declined to comment.<\/p>\n

The emergence of the TLB market is causing grief to loan bankers already grappling with low credit growth in Australia.<\/p>\n

“Every domestic Australian bank should be worried about leakage to this market. It is business we are missing out on,” said John Corrin, Australia & New Zealand Banking Group’s global head of loan syndications.<\/p>\n

U.S. TLB issuance has skyrocketed, driven by a combination of increased money supply and investors’ drive for yield. Total volume year-to-date hit $282 billion, up 57 percent compared to the same period last year according to UBS.<\/p>\n

Issuance by Australasian borrowers this year hit $3.74 billion, more than double the $1.48 billion of leveraged loans done in Australia according to Loan Pricing Corp data.<\/p>\n

ATTRACTIVE TERMS<\/p>\n

The TLB market offers attractive pricing over longer tenors compared to the Australian bank loan market. Currently borrowers can refinance seven-year debt in the TLB market for 300 basis points over Libor, compared with typical three-year leverage loan refinancing starting at 350 basis points over BBSY – Australia’s bank bill bid swap rate.<\/p>\n

The term loan B market is similar to the sub-investment grade or “junk” bond market in that it offers riskier borrowers long-term funding.<\/p>\n

“It maybe attractive for companies going through restructure or a growth change programme to lock in funding on set terms which can take the business through challenging times,” said Chris Champion, head of leverage finance at Goldman Sachs in Australia.<\/p>\n

Cinema operator Hoyts, owned by Australia’s Pacific Equity Partners, and packaging firm Pact Group, owned by New Zealand tycoon Graham Hart, have this week successfully priced debut issues after cutting the margin.<\/p>\n

“Market conditions in the U.S. are very strong at the moment, and certain issuers can achieve more aggressive pricing,” said Andrew Ashman, director Asia-Pacific loan syndicate at Barclays in Singapore.<\/p>\n

The foreign exchange risk is key for borrowers who do not have U.S. dollar revenues to hedge the debt repayment.<\/p>\n

“The market is a legitimate alternative for Australian issuers, but you need to be aware of the cost involved in breaking the foreign exchange swaps for operational or company reasons,” said Alistair Dick, head of debt advisory and restructuring, Rothschild Australia.<\/p>\n

The post Reuters – Alinta Plans Debt Raising in US<\/a> appeared first on peHUB<\/a>.<\/p>\n

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Alinta Energy is planning a $1 billion-plus debt issue in the U.S. term loan B institutional market to refinance maturing debt, writes Reuters. Alinta is owned by TPG Capital. Reuters – Private equity-controlled power firm Alinta Energy is planning a $1 billion-plus debt issue in the U.S. term loan B (TLB)institutional market to refinance maturing […]<\/p>\n","protected":false},"author":7428,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-659524","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/659524","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/7428"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=659524"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/659524\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=659524"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=659524"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=659524"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}