IBERDROLA completed a €750 million issue of 6-year bonds on the euro market today. Given the current favourable market conditions for companies such as IBERDROLA, the initial amount was raised by €250 million.
The issue was approximately two times over-subscribed, drawing orders of €1,400 million, and placed among more than 250 investors from 20 different countries. This success of this issue highlights market interest in IBERDROLA paper and the company’s ability to raise funds in different markets. This is reflected in the positive trend of the company’s risk indicator (5Y CDS), which is trading below 165 basis points.
The spread was 145bp with a 3.50% coupon. Bank of America, Barclays, BBVA, Caja Madrid and ING were lead managers.
The company seized upon the favourable market conditions to carry out this placement which will enable it to reduce bank debt and cover future financing needs. This issue follows others carried out by IBERDROLA in the last two years in the capital markets and September’s bond exchange, which have enabled it to raise around €11 billion.
At the end of June 2010 the company boasted a comfortable liquidity cushion (€9.4 billion), which covers its financing needs until mid 2012. IBERDROLA has reduced its gearing from 48.4% at the end of June 2009 to 45.8% at present (excluding the impact of the tariff deficit).
This release does not constitute an offer to purchase, sell or exchange or the solicitation of an offer to purchase, sell or exchange any securities. Particularly, this press release does not constitute an offer to purchase, sell or exchange or the solicitation of an offer to purchase, sell or exchange any securities in the United States of America. The shares of Iberdrola Renovables, S.A. may not be offered or sold in the United States of America except pursuant to an effective registration statement under the Securities Act or pursuant to a valid exemption from registration.