Tuesday 9th October 2012
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Auckland Council, New Zealand's biggest local body after its amalgamation of eight of the region's councils into one in November 2010, wants to raise up to $175 million in a retail bond offer.
The council plans to sell $125 million in six-year bonds, and will accept up to $50 million in oversubscriptions, it said in a statement. The funds will be used to pay for the council's infrastructure projects, and will carry credit ratings of AA from Standard & Poor's and Aa2 from Moody's Investors Service.
"The offer is an effective and efficient way to raise debt to fund infrastructure investment," chief financial officer Andrew McKenzie said. "When managed well, debt is a sensible way to fund our new capital projects and achieve the goal of making Auckland the world's most liveable city."
The interest rate will be set on Oct. 12 when the offer closes at 1.08 percentage points above the applicable six-year swap rate.
Australia & New Zealand Banking Group and Bank of New Zealand were appointed joint lead managers.
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