Powerco secures five-year bank facility

Electricity and gas lines company Powerco has secured a $100 million five-year revolving cash facility from its banking syndicate which it will used to repay bonds maturing next March.

"The term of the facility clearly demonstrates our banking syndicate's support and confidence in Powerco, the reliability and quality of our assets, the robustness of our financial structure and the stability of our earning capability," said chief financial officer Dennis Martin.

The $100 million in bonds mature on March 29 next year. The pay 6.22 per cent in interest annually and last traded on NZX's debt market at 5.2 per cent, or $1.0153 in the dollar.

The bonds began trading on March 31, 2004 and were "credit wrapped," or guaranteed, by US-based XL Capital Assurance, in order to obtain a "AAA" credit rating from Standard & Poor's. The bonds currently have Powerco's own "BBB" rating.

Powerco has four other listed bond issues, $130 million maturing September 2012, $100 million maturing March 2013, $50 million maturing June 2015 and $50 million maturing September 2017.

Powerco is New Zealand's second-largest electricity utility with about 420,000 customers connected to its networks throughout provincial North Island.