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AA pricing of new notes

05 July 2017 08:26

AA Bond Co - a subsidiary of the AA - has announced the pricing of a single class of sub-class A6 fixed rate notes to be issued under its multicurrency note programme listed on the Irish Stock Exchange, and redemption of the remaining sub-class A1 and sub-class A4 fixed rate notes.

At the same time, the AA group also announced a £98m reduction to be made to its senior term debt through the replacement of its existing senior term.

A statement said: "The issuer has priced £250m of new sub-class A6 fixed rate notes with an expected maturity of 31 July 2023 and a final maturity of 31 July 2043.

"The coupon is 2.75% payable semi-annually in arrears.

"The sub-class A6 notes will be senior secured Reg S bearer notes and are expected to be rated BBB?(sf) by S&P.

"Subject to conditions, the sub-class A6 notes are expected to be issued on 13 July 2017."

It said the proceeds from the notes would be used to redeem all of the remaining £175m 4.7201% sub-class A1 fixed rate notes and £55m 3.781% sub-class A4 fixed rate notes including any required make-whole payments on the next note interest payment date.

The AA said it would use £98m of its available cash resources along with the proceeds from a new senior term facility to prepay the existing senior term facility.

It said the new senior term facility had been negotiated to extend the maturity of the senior term debt from 31 January 2019 to 31 July 2021 as well as to reduce the margin.

It said a new working capital facility of £75m, reduced from the current £150m facility, would also be put in place to 31 July 2021 on a reduced margin. At 8:26am: (LON:AA.) AA Plc share price was +1.95p at 229.45p

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