LONDON: Italian utility Enel has renegotiated a 9.4 billion euro ($10.70 billion) revolving credit facility, extending the maturity of the loan and reducing the cost of the financing, the company said in a statement on Thursday.
The maturity of the financing, which can be used by Enel and by its Dutch subsidiary Enel Finance International, for day-to-day cash requirements, has been extended to 2020 from April 2018, previously.
Pricing on the loan is now 80 basis points (bp) over Libor, a substantial reduction from the 190bp charged on the deal previously.
The commitment fee on undrawn amounts has also been reduced to 35 percent of the applicable margin, down from 40 percent previously, or to 28bp from 76bp.
Mediobanca acted as documentation agent on the financing alongside a number of international and Italian banks. The financing is not related to the company's refinancing programme. Enel has taken advantage of a recent reduction in loan margins for Southern European borrowers to replace the expensive 9.4 billion euro forward start facility on improved terms.
The forward start was due to come into force in April 2015, when the company's existing core revolving credit facility matures.
The forward start was agreed in February 2013 at a time when borrowers in Southern European economies were forced to pay hefty premiums on their loans during the eurozone crisis to cover peripheral risk and overcome the reluctance of international banks' reluctance to lend.
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