Transurban taps capital markets after four years

The Australian toll road operator said early last week that it will issue A$250m of bonds to help repay debt – its first Australian bond issue since 2006. Transurban has A$195m of debt maturing in June.

Australian toll road operator Transurban said early last week that it plans to issue A$250 million of bonds to help repay existing debt.

Transurban: first Aussie
bond issue in four years

The bonds will mature in March 2014 and will pay a fixed coupon of 7.25 percent, or 180 basis points over the mid swap rate. Transurban chief financial officer Tom Hogan said the bond issue will diversify Transurban’s debt profile. He added the company is well on its way to replacing A$195 million of debt maturing in June with A$230 million of three-year bank facilities.

Commonwealth Bank of Australia and Westpac Institutional Bank are said to be leading the offer, according to Reuters, which is expected to be rated A-minus by S&P and Aa1 by Moody’s. Transurban last tapped the Australian capital markets in 2006, when it issued A$300 million of five-year notes.