Qantas has issued A$125 million in unsecured fixed rate notes, maturing in April 2020.
The notes are priced at 295basis points over the seven year swap rate. Settlement of the transaction is expected to occur on 26 April 2013. It will not affect Qantas’ overall debt position, with proceeds from the issue to be used to repay existing shorter term debt maturities.
The transaction follows Qantas’ recent term loan refinancing on April 11 that successfully refinanced the A$430 million term loan tranche of its A$1.28 billion unsecured, syndicated loan facility to April 2017.
The syndication resulted in over-subscriptions, part of which have been used to increase the term loan facility from A$430 million to A$550 million. The additional principal will be used to repay shorter term debt maturities.
Over-subscriptions have also been used to establish a new A$230 million revolving loan facility maturing in April 2017. This facility is undrawn and does not affect Qantas’ overall debt position.
With access to additional liquidity, Qantas says that its financial position remains strong and that its “capital expenditure has been reduced significantly and debt reduction continues to be a priority”. Qantas' next material unsecured maturity falls due in April 2015