Enel Said to Seek $6.7 Billion Credit Line to Extend FacilityStephen Morris
Enel SpA, Italy’s biggest power company, is seeking a 5 billion-euro ($6.7 billion) credit line to extend a facility due in 2015, according to five people with knowledge of the deal.
The company sent lenders a request last week for the five-year loan, said the people, who asked not to be identified as the terms are private. Banks have two weeks to commit to the forward-start loan, locking in financing terms before the existing debt matures, the people said.
Enel, based in Rome, is offering to pay initial interest of 195 basis points more than the euro interbank offered rate if it uses the facility, two of the people said. The margin will rise to 225 basis points if the credit line is fully drawn, they said. A basis point is 0.01 percentage point.
The new loan will replace Enel’s 10 billion-euro revolving credit facility maturing April 2015 that paid initial interest of 85 basis points more than benchmarks, the people said. Under a revolver, repaid money can be borrowed again.
A Rome-based spokeswoman for Enel declined to comment on the transaction and asked not to be identified citing company policy.
Enel has ratings of BBB+ from Standard & Poor’s and Fitch Ratings, the third-lowest investment-grade ranking, and a Baa2 grade from Moody’s Investors Service.
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