Drax secures financing for biomass-fuelled electricity generator
Coal-fired power plant operator Drax has secured committed financing to support the group's transformation into a predominantly biomass-fuelled electricity generator.
Coal-fired power plant operator Drax has secured committed financing to support the group's transformation into a predominantly biomass-fuelled electricity generator.
As of June 30th this year, the group held net cash of £233m. In addition, as Drax has previously announced, it has additional components of its funding programme comprising a £100m amortising term loan facility agreed with the Prudential/M&G UK Companies Financing Fund in July 2012 and £190m gross proceeds from an equity placing in October 2012.
The statement issued by the company today said it had now completed additional components of the financing comprising up to £100m amortising term loan facility agreed with the UK Green Investment Bank and £400m revolving credit facility maturing in April 2016 which will replace the existing £310 million revolving credit facility.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Drax's company statement added that it has also executed a new commodity trading facility, allowing Drax to transact prescribed volumes of commodity trades without the requirement to post collateral.
Commenting on the refinancing, Tony Quinlan, Finance Director of Drax said: "We are very pleased to have successfully secured this financing. We believe it is a clear demonstration of support from the investment community for our biomass strategy. We particularly welcome the involvement of the UK Green Investment Bank.
"We are making very good progress with our project to transform the largest coal plant in the UK into an electricity generator fuelled predominantly by sustainable biomass. The benefits are multiple, from securing jobs at Drax and across the UK in the supply chain to providing low carbon, cost effective and reliable renewable power for the consumer," he added.
Drax Group's share price down 0.62% to 563.50p art 14:34 on Thursday afternoon.
MF
Sign up to Money Morning
Our team, led by award winning editors, is dedicated to delivering you the top news, analysis, and guides to help you manage your money, grow your investments and build wealth.
-
8 of the best houses for sale with libraries
This week: the best houses for sale with libraries – from a five-storey Georgian townhouse in Bloomsbury, London, to a 15th-century property with a library in a medieval tower in Lozère, France
By Natasha Langan Published
-
Investors pull money from UK equities as government warns of “painful” Budget
The government’s post-election honeymoon period has been short-lived, and investors are shying away from UK equities as a result
By Katie Williams Published