KANSAS CITY, Mo., April 11, 2003 — Aquila Inc. announced that it has completed a new financing agreement that replaces its short-term credit facilities.
The package consists of two secured loan facilities — a one-year $200 million loan to UtiliCorp Australia, Inc. and a $430 million three-year term loan to Aquila. The initial amount drawn under the one-year loan will be $100 million, and the company will have an option to draw another $100 million within the next 30 days. The one-year loan is non-recourse to Aquila, Inc.
“Completing this financing package is a key component of the overall plan we’ve been pursuing to achieve financial stability and return Aquila to its regulated utility roots,” said Rick Dobson, Aquila’s interim chief financial officer. “We clearly have more work ahead, but with this financing in place, plus our existing cash and cash flow from operations, the company should have sufficient liquidity to execute the remainder of its restructuring plan.”
Proceeds from the loan package will be used to terminate the company’s existing 364-day senior bank facility, repay synthetic leases associated with two power plants in Illinois, and cash collateralized outstanding letters of credit. Initial interest rates on the loans are 7 percent for the one-year loan and 8.75 percent for the three-year term loan.
Collateral for the one-year loan includes the company’s interests in its Australian investments, interests in its portfolio of U.S.-based independent power plants and two nonregulated power plants in Illinois.
Collateral for the three-year term loan will include a combination of the company’s non-regulated and regulated utility assets. Later this month Aquila will initiate regulatory proceedings to secure the three-year loan with additional U.S.-based regulated utility assets. Upon regulatory approval, the interest rate on the three-year loan will be reduced to 8.00 percent.
Credit Suisse First Boston served as the sole arranger for the new loans.
Additional details on the refinancing will be discussed when Aquila reviews its 2002 fourth-quarter and year-end results during a webcast scheduled for April 15 at 9:00 a.m. Eastern.
Based in Kansas City, Missouri, Aquila operates electricity and natural gas distribution networks, serving customers in seven states and in Canada, Australia and the United Kingdom. The company also owns and operates power generation assets. More information is available at www.aquila.com.