BAA places £400 million Sterling bond

BAA has announced that yesterday it successfully placed a £400 million Sterling Class B bond, with a 2018 maturity and a fixed annual interest coupon of 6.25%. The company generated an initial order book of over £1 billion and was able to price inside initial price guidance at 375 basis points over gilts. Fred Maroudas, BAA's Director of Treasury, said: "BAA is delighted to have achieved another successful bond placing with a broad group of investors to underpin financing for improving Heathrow. Following the £625 million Class B bank loan announced last month, this shows the level of confidence many high quality investors have in the financial platform BAA has developed." BAA plans to use the proceeds of the bond issue to refinance part of its existing bank debt, lengthening the group's debt maturity profile.