Sharechat Logo

Spark considers $150 million, seven-year retail bond offer

Tuesday 17th November 2015

Text too small?

Spark New Zealand, the country's biggest telecommunications company, may raise up to $150 million through a retail bond offer, joining a growing number corporates taking advantage of low interest rates to raise debt funding.

The Auckland-based company's Spark Finance subsidiary plans to make an offer of up to $100 million unsecured, unsubordinated seven-year bonds to institutional and retail investors, with oversubscriptions of up to $50 million, it said in a statement.  Full details of the offer will likely be released in two weeks, and Spark Finance has appointed ANZ Bank New Zealand and Commonwealth Bank of Australia as joint lead managers, with Deutsche Craigs co-manager.

Spark didn't give any indication on potential pricing, but the seven-year swap rate was recently at 3.315 percent, having declined from 4.03 percent at the start of the year.

The bond offer would follow other companies who have turned to the debt market to raise cash as interest rates remain low, including Auckland International Airport, SkyCity Entertainment Group, Contact Energy and Infratil.

Last month, AMP Capital Investors (New Zealand)'s head of fixed income and managing director Grant Hassell predicted more firms would return to the debt market where they could raise money cheaply.

In September, Spark beefed up its bank funding lines with a new $100 million facility with Westpac New Zealand, having ditched a near-identical facility with that bank in March.

The company scaled back plans for capital expenditure in the current year to about $380 million from the $576 million it spent in the year ended June 30, which included a $158 million price tag for extra 700 megahertz radio spectrum.

Spark shares fell 1.8 percent to $3.20, and have increased 4.7 percent this year.

 

 

BusinessDesk.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report