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SYDNEY, April 9 (Reuters) - Communications infrastructure
provider Broadcast Australia Pty Ltd has bought back A$160.5
million ($114 million) of bonds maturing in July, the company
said.
The bond buyback is part of a growing trend that sees
borrowers saving money by buying back outstanding debt at a
discount as investors are attracted by the certainty of
immediate payments.
Investment bank Macquarie Bank (MQG.AX) is buying back up
to $350 milion of subordinated debt callable in 2010 at 50 to
60 cents per dollar. Insurance Australia Group Ltd (IAG.AX)
recently bought back 144 million pound ($211.4 million) of sub
debt maturing in 2026 at 70 pence per pound.
Broadcast Australia paid a clean price, excluding accrued
interest, of 99.750 for the 2009 bonds, leaving A$89.5 million
of bonds on issue due on July 9.
"We wanted the certainy that the refinancing would bring...
and take advantage of buying back the bonds below par if
investors wanted to sell them," said Brett Savill, finance
director at Broadcast Australia.
The Broadcast issue was initially sold in 2002 and was part
of a A$650 million, three-tranche, credit-wrapped bond that was
then rated AAA.
However, the ratings were cut to A by S&P and Baa1 by
Moody's following the downgrade of Ambac Financial Group Inc
(ABK.N), which wrapped, or insured, the bonds.
Ambac, the second-largest U.S. bond insurer, lost its AAA
rating last year following huge losses.
Broadcast is owned by Macquarie Infrastructure
Communications Group MCG.AX, which is the subject of an
agreed $930 million bid from the Canada Pension Plan Investment
Board.
($1=1.408 Australian Dollar)
($1=.6811 Pound)
(Reporting by Cecile Lefort)
