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Telecom trims and extends banking facility

Telecom trims and extends banking facility

April 15 (BusinessDesk) - Telecom Corp, the country’s biggest telecommunications company, has trimmed the size of a banking facility, while pushing out its maturity date until 2017.

The Auckland-based company reduced the $400 million committed standby revolving credit facility with Australasian and global banks to $300 million, while extending the maturity date one year to April 14, 2017, it said in a statement. Telecom had total debt of $1.22 billion as at Dec. 31, with bank funding of $440 million.

“The agreement of this facility helps ensure Telecom has sufficient liquidity to meet its business needs over the next three years,” chief financial officer Jolie Hodson said. “Telecom remains committed to an A band credit rating.”

In December, Telecom said it would use the A$450 million from the sale of its AAPT unit to repay debt in the first instance. The company borrowed $390 million of long-term debt and $565 million in short-term debt in the six months ended Dec. 31, while repaying $253 million and $466 million respectively. It had a net cash inflow from its financing activities of $116 million in the period, which also includes dividend payments.

The shares rose 0.8 percent to $2.66, and have gained 15 percent this year, outpacing the 4.3 percent increase on the NZX All Index, a capital measure of domestic equities, over the same period.


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