Origin refinances $2.4bn in debt
Australia's largest electricity retailer Origin Energy has pushed back its next debt repayment to 2015 after securing a $2.4 billion syndicated bank loan facility.
Origin has been actively chasing long term debt over the past year to meet its funding share of the massive $US23 billion ($A22.56 billion) Australia Pacific LNG project in Queensland, in which it has a 37.5 per cent stake.
The new loan facility has terms of four and five years and will be used to refinance existing loan facilities maturing next year and in 2014, removing any requirement for refinancing until the 2015 financial year.
Origin's executive director of finance and strategy, Karen Moses, said the company had received strong support, as evidenced by high demand from lenders.
It raised 500 million euros ($A640.45 million) through a bond issue this week, following the printing of $US500 million 10-year bonds last year and a $900 million hybrid issue in Australia.
Origin is also trying to sell down its stake in APLNG to 30 per cent to ease its balance sheet.
At June 30, Origin reported $5.9 billion of debt but $1 billion of that was attributable to New Zealand's Contact Energy, in which it is a majority shareholder.
Its undrawn facilities totalled about $4.2 billion.
Morningstar equities analyst Gareth James said he did not see Origin as having debt problems, unlike highly-geared iron ore miner Fortescue Metals Group which also recently refinanced its debt so it did not fall due until late 2015.
"Unlike Fortescue with volatile earnings, Origin produces a strong cashflow from its energy retailing business as the largest provider in Australia," he told AAP.
About 90 per cent of earnings come from Origin's energy retail and generation business.
But there are concerns about its near-term growth, with capital expenditure stopped due to its focus on the LNG development in Queensland.
Origin shares had climbed six cents to $11.64 at 1.00pm.
