Press Release

BAA places £750m Sterling bond to refinance existing debt

BAA today announces that it has successfully placed a £750m Sterling bond, with a May 2041 maturity and a fixed annual interest coupon of 5.875%. The company generated an order book of nearly £1.5bn (three times over-subscribed against an initial size of £500m) and was able to price at tight end of guidance at 175 basis points over gilts.

Fred Maroudas, BAA’s director of treasury, said: ” BAA’s ability to issue such long-term debt demonstrates investors’ confidence in the company. The institutions who participated are once again of the highest quality and the credit spread was around one percentage point below the last comparable bond issue in November 2009, showing how bond market sentiment towards BAA has improved over the last 18 months.”

BAA plans to use the proceeds of the bond issue to repay short-term bank debt, significantly lengthening the company’s debt maturity profile and further strengthening the platform from which to invest in Heathro’s substantial transformation programme.

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