LONDON (Alliance News) - AA PLC said Monday that it will raise up to GBP600 million via loan notes issue and will also concurrently launch a tender offer to buyback GBP500 million worth of notes.
Shares in AA were trading 2.1% higher at 126.80 pence on Monday.
The roadside vehicle assistance provider said it will issue fixed-rate class A notes with a six year tenure. Up to GBP350 million of the proceeds of the new notes are expected to be used by the company to fund the tender offer for outstanding GBP500 million 4.2487% Class A3 Secured Notes due 2020/2043.
AA additional intends to use the new notes to redeem in full its existing GBP250 million senior term facility due 2021.
The UK listed company also said that it will replace its existing working capital facility with a new working capital facility GBP60 million, together with a GBP15 million accordion facility, with a maturity to July 31, 2023, and with the current margin.
"These refinancings are in line with the AA's disciplined and pro-active approach to its capital structure and reduce any refinancing risk in the near-term. The extension in maturity of debt will mean that the next repayment of borrowings is not due until January 2022, providing significant runway for management to focus on the recently-announced strategic plan," AA said.
Greenhill and Co acted as sole financial advisor to AA on the transaction.
