Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


MightyRiverPower's 2044 bonds deemed 'intermediate equity' b

MightyRiverPower's 2044 bonds deemed 'intermediate equity' by S&P, rated BB+

By Jonathan Underhill

June 9 (BusinessDesk) - MightyRiverPower's proposed issue of up to $300 million of July 2044 bonds has been rated BB+ and assessed as 'intermediate equity' by Standard & Poor's, meaning the ratings company will classify 50 percent of the interest paid as dividends.

The rating and classification come after S&P last year changed its criteria for assessing the equity content of hybrid instruments such as MightyRiverPower's subordinated capital bonds, which can be redeemed early and have interest payments deferred at the power company's discretion, and are subject to having their terms reset on July 11, 2019, and every five years thereafter.

The company's own credit rating is BBB+ and the rating on the bonds, which is below investment grade, reflects their subordination and interest deferred features, chair Joan Withers said in the prospectus.

The minimum interest rate for the first five years will be set via a bookbuild and is expected to be in a range of 6.8 percent to 7 percent. Funds raised will be used for general corporate purposes, repayment of bank debt and to extend the average term of the company's funding, it said. The offer will include a public pool, giving preference to existing shareholders in the event of scaling, MightyRiverPower said.

The company "believes that hybrid securities that are ascribed equity content such as the capital bonds are an effective capital management tool and intends to maintain such instruments as a key feature of its capital structure going forward," it said.

Forsyth Barr, ANZ New Zealand, Deutsche Craigs and Goldman Sachs are managing the sale. The offer opens on June 18 and closes July 8. The bonds are expected to be quoted on the NZX Debt Market from July 11.

The shares last traded unchanged at $2.26 and have gained 6.1 percent this year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

RMTU: Mediation Between Lyttelton Port And Union Fails

The Rail and Maritime Union (RMTU) has opted to continue its overtime ban indefinitely after mediation with the Lyttelton Port of Christchurch (LPC) failed to progress collective bargaining. More>>

Earlier:

Science Policy: Callaghan, NSC Funding Knocked In Submissions

Callaghan Innovation, which was last year allocated a budget of $566 million over four years to dish out research and development grants, and the National Science Challenges attracted criticism in submissions on the government’s draft national statement of science investment, with science funding largely seen as too fragmented. More>>

ALSO:

Scoop Business: Spark, Voda And Telstra To Lay New Trans-Tasman Cable

Spark New Zealand and Vodafone, New Zealand’s two dominant telecommunications providers, in partnership with Australian provider Telstra, will spend US$70 million building a trans-Tasman submarine cable to bolster broadband traffic between the neighbouring countries and the rest of the world. More>>

ALSO:

More:

Statistics: Current Account Deficit Widens

New Zealand's annual current account deficit was $6.1 billion (2.6 percent of GDP) for the year ended September 2014. This compares with a deficit of $5.8 billion (2.5 percent of GDP) for the year ended June 2014. More>>

ALSO:

Still In The Red: NZ Govt Shunts Out Surplus To 2016

The New Zealand government has pushed out its targeted return to surplus for a year as falling dairy prices and a low inflation environment has kept a lid on its rising tax take, but is still dangling a possible tax cut in 2017, the next election year and promising to try and achieve the surplus pledge on which it campaigned for election in September. More>>

ALSO:

Job Insecurity: Time For Jobs That Count In The Meat Industry

“Meat Workers face it all”, says Graham Cooke, Meat Workers Union National Secretary. “Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news