Colbun Seeks Loan Commitments

Chilean power company Colbun is expecting commitments this week on a loan it is syndicating, says a banker at one of the leads. BBVA and Santander are leading the $150m 5 year at Libor plus 150bp. The facility is to refinance part of a $400m loan taken in 2008 that matures in 2013. ABN, BBVA, Citi, Itau and Santander participated in that deal. “The loan was expensive and had restrictive terms, due to difficulties experiences as a result of a drought,” says a lead banker. “But the company has since benefitted from capital injections, so wants to get better financing.” Part of the facility has already been paid off, using $250m of a 2020 $500m bond issued in January. The deal was Colbun’s first dollar bond sale, and was more than 5x oversubscribed. It came at 98.973 with a 6.000% coupon to yield 6.139%, or UST plus 237.5bp, well inside 262.5bp area guidance. “The terms of the loan are quite competitive and the borrower likes to use a mixture of bank and capital market debt so chose to come to the loan market for refinancing the remainder,” adds the banker. Colbun has a capex pipeline, with a number of power plant projects planned. It will probably look to get project financing for that in the next 2-3 years, according to the banker.