LONDON, Oct 3 (Reuters) - EDF has launched an 11 billion pounds ($19.46
billion) loan backing its 12.5 billion pounds acquisition of British Energy to
its senior relationship banks, the company said on Friday.
EDF's bid was recommended by British Energy's board on Sept. 24 and EDF
and Centrica are in discussions for Centrica to buy a 25 percent interest in
British Energy, according to the company.
EDF's loan has been conservatively structured with short-term maturities
and generous pricing of over 100 basis points (bps) over LIBOR that is designed
to cover banks' increased funding costs.
The loan includes a 5.5 billion pounds 364-day term loan with a 364-day
extension option, which pays a margin of 100 bps over LIBOR for the first six
months, rising to 110 bps thereafter.
It also has a 5.5 billion pounds three-year term loan paying a margin of
120 bps. The interest margin is linked to a ratings grid.
The high interest margins emphasise the dislocation in the illiquid
European loan market, which is already currently trying to digest around $94.5
billion of M&A loans for InBev, Schaeffler and Gas Natural.
EDF, which is 84.8 percent owned by the French state, paid a margin of
12.5 bps over EURIBOR when it secured a 6 billion euro refinancing in 2005.
EDF said it intends to refinance the facilities in the debt capital
markets in the near future.
Banks are being invited to make take and hold commitments of 500 million
pounds across the tranches for mandated lead arranger fees of 10 bps and
participation fees of 70 bps.
The loan is in the market via bookrunners and underwriters Bank of Tokyo
Mitsubishi, Barclays, BNP Paribas, Calyon, HSBC, Royal Bank of Scotland and
Societe Generale.
(Reporting by Zaida Espana; Editing by Paul Bolding) ($1=.5653 Pound)
Keywords: EDF LOAN/
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