Brisbane Airport A$350 million bonds oversubscribed

Brisbane Airport is raising A$350 million via a 10-year bond issue to refinance some of its existing bank facilities.

Brisbane Airport Corp's (BAC) A$350 million ($211 million) 10-year bond issue was priced today. The A$150 million fixed rate notes were set at 99.58 to yield 7.36% on a semi-annual basis and the A$200 million floating rate notes were priced at par, giving a coupon of 52 basis points over the 90-day BBSW (bank bills swap rate). The bonds, which are guaranteed by MBIA Insurance Corp, are rated triple-A by both Moody's and Standard & Poor's.

"The deal has been comfortably oversubscribed," says Peter Christie, senior manager for primary markets at Commonwealth Bank of Australia, which jointly managed the bond with Deutsche Bank. He estimates 10% to 15% was sold to Asian and European investors, with the remainder taken up domestically. Settlement for the bonds is 30 June.

The proceeds of the bond issue will be used to partially refinance an A$820 million seven-year debt facility, which was taken on when the current owners bought Brisbane Airport from the Australian government for A$1.4 billion in 1997. The refinancing means BAC will no longer have to repay all of its borrowings at once.

BAC is owned by Amsterdam Airport Schipol, Port of Brisbane Corp, Commonwealth Financial Services, Brisbane City Council and Commonwealth Bank of Australia.