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National Express (NEX)

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Thursday 07 January, 2010

National Express

Launch of seven year bond

RNS Number : 2177F
National Express Group PLC
07 January 2010

7 January 2010

National Express announces launch of seven year bond

National Express Group PLC ("National Express" or the "Group") has today successfully launched a £350 million seven year Sterling bond issue (the "Bond"). The Group expects the Bond to be issued on 13 January 2010 with an annual coupon of 6.25 per cent (subject to any step up in accordance with the terms of the Bond*) and a bullet repayment on 13 January 2017. The joint bookrunners for the issue are Barclays Capital, Commerzbank and RBS.

The proceeds from the issue of the Bond will be used to repay the Group's existing bank borrowings, with the Group's existing €270 million Euro facility maturing in March 2011 expected to be repaid in full. The Bond will extend the average maturity of the Group's remaining debt, reduce the Group's reliance on bank financing and diversify and strengthen the Group's overall funding structure.

Following the rights issue completed in December and this Bond issue, the Group will adjust its interest rate management arrangements. Certain of the Group's existing interest rate swaps (relating to hedging of the existing Euro denominated debt) will become ineffective and will be terminated, resulting in an exceptional expense and cash outflow of approximately £17.5 million.

Commenting, Jez Maiden, Group Finance Director, said:

"The successful launch of this bond marks a further step in delivering improvement at National Express. Over the past months, we have significantly reduced debt through a focus on cash generation, we have successfully completed a £360 million rights issue and we have now refinanced our maturing bank debt ahead of schedule. Leading bond investors have been strongly supportive of this debut bond issue."


National Express Group PLC

Jez Maiden, Group Finance Director  

020 7506 4324

Nicole Lander, Director of Communications  

012 1460 8401


Neil Bennett/George Hudson   

020 7379 5151

*The Bond is being issued subject to the Group obtaining two investment grade credit ratings prior to 13 January 2011. In the event that the Group does not obtain such ratings by this date, the coupon will step up by 1.25 per cent. thereafter. The Group has begun discussions with the major rating agencies to commence the rating process. There are no financial covenants contained in the Bond. 

This information is provided by RNS
The company news service from the London Stock Exchange