AUS
NZ
UK
CA
USA
IND
_10_04_2024_16_38_50_427275.jpg)
Highlights
- Contact Energy announced making an offer of up to $200 million of green capital bonds to NZ investors.
- The Group registered a product disclosure statement for the offer on 29 October.
- Capital Bonds have a maturity of 30 years with the maturity date of 19 November 2051.
Contact Energy Limited (NZX:CEN;ASX:CEN) is an NZ-based company that supplies electricity, natural gas, LPG and broadband services to over 500K customers across NZ.
CEN had announced its intention to put unsecured subordinated green capital bonds on offer to NZ investors on 26 October. The offer was of redeemable, interest-bearing green capital bonds which are debt securities issued by Contact. It’s traded on the NZX Debt Market under the ticker, CEN060.
Image source: © 2021 Kalkine Media, Data source- EODHD/Others
The Group registered a product disclosure statement three days after for a green capital bond offer of up to $200 million to NZ retail and institutional investors with the ability to accept oversubscriptions of up to $25 million.
RELATED READ: Why these 5 NZX energy stocks can be considered before 2021 ends
The funds will be used to finance and refinance renewable generation assets and other eligible assets.
The Offer details
CEN also notified that the Capital Bonds have a maturity date of 19 November 2051. However, they can be redeemed sooner for tax or rating agency purposes from 19 November 2026.
DO READ: Can electric batteries help shipping industry go green?
S&P Global Ratings expects the Capital Bonds to have a credit rating of BB+, indicating their subordination and the potential for interest payments to be deferred.
The initial interest rate will be the total of the five-year swap rate plus the margin, subject to a minimum interest rate for the first five years.
RELATED READ: 5 NZX energy stocks helping NZ achieve 2050 carbon neutrality goal
CEN also informed that the margin and the initial interest rate will be established following a bookbuild procedure on 12 November 2021 and will be communicated by it through the NZX shortly afterwards.
The offer is being made in conformity with the Financial Markets Conduct Act 2013.
DO READ: 5 NZX stocks with a healthy dividend yield
The offer will open on 8 November 2021 and will close on 12 November 2021. Bonds are most likely to be issued on 19 November 2021 and get quoted on the NZX Debt Market on 22 November 2021.
CEN ended the day flat at $8.1.
Bottom Line
Contact has committed to a low energy future for NZ and has a strong focus on renewable energy.
(NOTE: Currency is reported in NZ Dollar unless stated otherwise)
