Kier secures new funding

Construction, services and property group Kier is set to benefit from a multi-million pound loan under the government's funding-for-lending scheme (FfLS).

The firm has entered into a £30m unsecured four-year bilateral loan with Lloyds Banking Group.

The FfLS was introduced by the government partly to stimulate investment in UK infrastructure.

Kier said the loan gave it with competitively priced funding to be used in connection with its infrastructure and related projects.

The company also said it had issued 7-year and 10-year notes in aggregate principal amounts of £45m and $28m in four series, with coupons ranging from 4.2% to 4.8% per annum.

The notes will be used to refinance Kier's existing £17m 6.4% notes and $22m 6.2% notes, which will mature on February 19th 2013, and for continued investment in Kier's property development pipeline.

Group Finance Director Haydn Mursell said the private placement and the FfLS loan increased the group's available funds and have been secured at very competitive pricing levels.

"The FfLS clearly indicates that the UK government is committed to supporting infrastructure projects as a means of moving the UK economy out of recession," he said.