Genesis Energy joins list of corporates lining up to sell bonds while rates are low

Wednesday 2nd March 2016

Genesis Energy plans to sell six-year bonds, joining a growing list of corporates selling debt while interest rates are low.

The country's biggest electricity retailer said it would give details such as the amount and indicative margin before the offer opens next week. It has hired Deutsche Craigs and Westpac Banking Corp as joint lead managers.

Genesis has $105 million of NZX debt market-listed bonds maturing on March 15, which carry a coupon of 7.65 percent. At the time they were issued in December 2008, the seven-year swap rate was about 4.95 percent. It touched a record low 2.7675 percent this week.

Genesis will join Meridian Energy, New Zealand's largest hydro electricity generator and wind farm operator, which is planning to sell $150 million of seven-year bonds, at an indicative margin of 1.6 percent to 1.75 percent per annum over the comparable benchmark.

Other New Zealand corporates selling bonds at a time of low rates, including the country's biggest dairy exporter Fonterra Cooperative Group, the biggest telco company Spark New Zealand, and the busiest airport Auckland International Airport.

Genesis plans to offer the bonds to institutions and retail investors and list them on the NZX debt market.

BusinessDesk.co.nz

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