Yesterday, Israel Electric Corporation (IEC) raised NIS 1 billion in an offering to financial institutions, at interest rates below 1%. The offering was under a shelf prospectus that the company filed in April 2018.
In the offering, two existing bond series were expanded: series 30 (shekel denominated bonds with a duration of 3.7 years) and series 31 (index-linked bonds with a duration of 9.5 years). In series 30, IEC raised NIS 143 million at a yield to redemption of 0.89%, a spread of 0.59% above equivalent government bonds. In series 31, the company raised NIS 857 million at a real return to redemption of 0.75%, a spread of 1.27% above equivalent government bonds.
IEC did not disclose the identities of the buyers, but did state that the offering met lively demand on the capital market, amounting to NIS 2.2 billion.
A public stage of the offering is planned for tomorrow (Tuesday). The bonds are rated ilAA+ by S&P Maalot, with a stable outlook, and Aa2.il with a positive outlook by Midroog.
IEC chairman Yiftah Ron-Tal said, "The success of the offering once more testifies to the confidence of investors in Israel in Israel Electric Corporation, in the historic reform in the power industry, and its implementation by the company. The proven ability of the company's management to carry out complex and challenging processes in a dynamic and unstable environment, at the beginning of a competitive era, is impressive."
The company's CEO Ofer Bloch said, "Even at a time of global crisis, in both the economic and the health spheres, investors were not deterred, and injected high demand for the offering, the success of which is testimony to the financial stability of the company and a vote of confidence in the management of its debt, which has been judicious and responsible. The rating agencies expressed confidence in the company's direction and investors clearly read the situation correctly."
Published by Globes, Israel business news - en.globes.co.il - on May 25, 2020
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