Chicago, Nov. 3 – APA Infrastructure Ltd. priced €500 million of 7.125% hybrid subordinated capital securities with a 60-year tenor (Ba1/BB+) on Thursday, according to a press release and a market source.
Initial price talk was for a yield in the 8% area.
The fixed interest rate through February 2029, achieved through swap, is 9.32%. After the first call date, interest will be swapped back into Australian dollars.
The initial rate resets on Feb. 9, 2029 if the notes have not been called. The rate will reset to the five-year mid-swap rate plus the initial spread. There will be step-ups, 25 bps on Feb. 9, 2034 and another 75 bps on Feb. 9, 2049.
Bank of America handled billing and delivery. BNP Paribas and JPMorgan were also bookrunners.
The final order book was over €4.8 billion.
Proceeds will be partly used, with an A$1.25 billion syndicated term loan, to replace short-term debt facilities used for the acquisition of Alinta Energy Pilbara on Aug. 23 and for general corporate purposes.
A guarantee on a subordinated basis comes from APA Group Ltd.
APA is a Mascot, Australia-based energy transmission company.
| Issuer: | APA Infrastructure Ltd.
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| Guarantor: | APA Group Ltd.
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| Amount: | €500 million
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| Issue: | Hybrid subordinated capital securities
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| Tenor: | 60 years
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| Bookrunners: | Bank of America (billing and delivery), BNP Paribas and JPMorgan
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| Coupon: | 7.125% initial rate, resets if not called on Feb. 9, 2029 to five-year mid-swap rate plus initial spread; interest steps up 25 bps on Feb. 9, 2034; steps up again 75 bps on Feb. 9, 2049
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| Call features: | During 90 days before Feb. 9, 2029, any interest payment date thereafter
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| Change of control: | At par
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| Trade date: | Nov. 2
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| Settlement date: | Nov. 9
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| Ratings: | Moody’s: Ba1
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| S&P: BB+
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| Distribution: | Regulation S
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| Price talk: | 8% area yield
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| ISIN: | XS2711801287
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