Riga, 2014-10-29 11:56 CET (GLOBE NEWSWIRE) -- Last week the shareholders’ meeting of Latvenergo AS decided to enter into loan agreements with the winning bidders of the bank loan tender that was announced on 25 April 2014 to attract capital of up to EUR 150 million under the borrowed capital attraction plan.
The subject of the procurement was divided into two parts. The first procurement part was for the conclusion of the loan agreements for up to EUR 100 million, with a 5-year maturity and with an option to extend it by 2 years, while the second part – for the conclusion of the loan agreements for up to EUR 50 million, with a maturity of 7 years. The selection criterion of bids – economically the most advantageous bid.
The winners of the first part of the procurement were Pohjola Bank Plc, Svenska Handelsbanken AB Latvijas filiāle and SEB banka AS, while Pohjola Bank Plc and Swedbank AS were the winners of the second part.
Evaluating the procurement process and submitted bids, Jānis Irbe, Group Treasurer of Latvenergo AS emphasises: "Although Latvenergo AS regularly ensures the borrowed funds in the form of bank loans, this procurement has caused historically the highest interest in the banking sector, receiving offers in the amount of EUR 530 million in total from nine banks of the region. Not only the activity of the banks, but also the financial terms of the submitted bids prove that the banks consider Latvenergo AS as a stable partner and indicate the banks trust in the performance of Latvenergo Group and its perspectives in these fluctuating market conditions.”
The borrowed funds are intended for financing the capital investments into electricity generation assets and network infrastructure that are essential for ensuring a high-quality and secure electricity supply and maintenance of the competitiveness in the electricity market in the Baltic region. On average, the planned annual capital investment programme is EUR 250 million, and the Group partially finances its implementation from the borrowed funds. Latvenergo AS regularly attracts the borrowed capital to ensure required funds in a timely manner for financing of capital investment programme of several years.
The previous loan procurement from commercial banks was organised in 2009, providing the borrowed capital necessary for financing of the Group investment programme for the period 2010–2012. As a result of the procurement procedure, in 2010, loan agreements with Nordea Bank Finland Plc Latvijas filiāle, DnB NORD Banka AS, Swedbank AS, and SEB banka AS for the total amount of EUR 90 million were concluded.
Currently, in addition to the procurement of bank loans, two planned processes for ensuring borrowed capital are ongoing - activities to source a loan in the amount of EUR 100 million from the European Investment Bank and preparation works for the bond issue programme for an amount of up to EUR 100 million.
Additional information:
Jānis Irbe
Group Treasurer
Phone: +371 67 728 239
E-mail: investor.relations@inbox.lv
About Latvenergo
Latvenergo Group is a pan-Baltic energy company, engaging in electricity and thermal energy generation and supply, electricity distribution services and management of transmission system assets. Latvenergo Group holds one-third of the entire Baltic electricity market, thus ensuring its leadership in the Baltic electricity supply. Latvenergo AS has been acknowledged as the most valuable company in Latvia for several years in a row. International credit rating agency Moody’s has assigned Latvenergo AS an investment-grade credit rating of Baa3/stable.
Latvenergo Group includes the parent company Latvenergo AS (electricity and thermal energy generation and supply) and its subsidiaries Latvijas elektriskie tīkli AS (management of transmission system assets), Sadales tīkls AS (electricity distribution), Elektrum Eesti OÜ (electricity supply in Estonia), Elektrum Lietuva UAB (electricity supply in Lithuania), Enerģijas publiskais tirgotājs AS (administration of electricity mandatory procurement process) and Liepājas enerģija SIA (electricity and thermal energy generation and supply), as well as Elektrum Latvija SIA (electricity supply), a subsidiary of Elektrum Eesti OÜ.