Iberdrola Issues €1 Billion in Bonds, Strengthens Balance Sheet

Thursday, Jan 15, 2009

• The issue was placed in record time, having received more than 3.2 billion euros in subscriptions.
• The issue increases the size of last November’s placement, with significantly improved financial terms.
• IBERDROLA thereby underlines its financial strength and highlights market confidence in the company.

IBERDROLA today closed an issue of €1 billion in bonds in the European market in three and seven year tranches, as a result of which it has been able to refinance existing debt on favourable terms with an extension of its average life.

The operation consisted of an increase in its two-tranche €1.6 billion issue last November 13. Participating banks were La Caixa, ING and Société Génerale.

The bonds were aimed at international investors and were fully subscribed in record time of two and a half hours. The offer attracted €3.2 billion in orders, underlining the extent of investor interest in the company and its ability to obtain funding in adverse situations.

The conditions are more favourable than those obtained in November and are among the best obtained in recent times by a company with a similar rating to IBERDROLA. The spread was 180 basis points over three-year swaps for a €450 million tranche, and 280 basis points over seven year swaps for the remaining €550 million.

With this operation, IBERDROLA improves its already strong liquidity position ahead of 2009 requirements.

Source: Iberdrola