APA (ASX:APA) arranges $1bn syndicated loan facility

Energy infrastructure business APA Group (ASX:APA) has raised $1 billion of senior unsecured debt via a syndicated loan facility.

The company said it received strong support from more than 20 new and existing financiers enabled APA to increase the size of the offering from $500 million to $1 billion. The loan syndicate includes a number of Australian and Asian banks.

The new facility comprises two equal tranches of 5 and 7 year tenor. Both tranches are swapped into fixed rates with the overall cost broadly in line with APA’s existing average cost of debt.

APA said the proceeds of the offering would refinance the variable debt used to fund the acquisition of Basslink debt, contribute to funding APA’s growth projects and for general corporate purposes.

“The Asian syndicated loan market is a new market for APA. The benefits of accessing this market include diversification of our funding base and rates that are currently more attractive than those available in the corporate bond market,” said chief financial officer Adam Watson.

“We are delighted with the strong support from our financiers. It illustrates the confidence they have in our business and enables us to continue to strengthen our balance sheet.”

Shares are trading 4.1 per cent higher at $11.66.