Bord Gais Eireann's notes to refinancing the utility's debt.

BG are borrowing €550m in the form of corporate notes maturing in June 2014 with a 5.75pc coupon. 5.75% is a better return for a would be investor than sticking the €550m in a deposit account. If BG goes belly up the investor loses, which is what should have happened to the Anglo bond holders. :rolleyes:
 
Tender offer for Bord Gais debt

Last Updated: Wednesday, November 21, 2012, 09:56

BNP Paribas has announced a tender offer for €550 million of Bord Gais Eireann's notes as part of a refinancing of the utility's debt.

"The purpose of the offer is to take advantage of currently favourable market conditions to lengthen and smooth the debt maturity profile of the company," a statement said.

The 5.75 per cent notes are due June 16th, 2014.

The company has also announced its intention to issue a series of new euro-denominated fixed rate notes under its Euro medium term note programme.

"Bord Gais is hoping to tap into some of the same investor demand seen last week when the ESB issued an earlier bond, '' said Ryan McGrath, an analyst at Dolmen Securities in Dublin, in a note today before the statement was released.
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So BGE issue a press release stating that they are about to restructure their debt. This is a normal part of any commercial enterprise. They hope to tap into the same investor demand seen last week when the ESB issued a similar bond. This is part of how large companies (in particular utilities like BGE) are financed.

title expanded changed from "What exactly is a note and can I write one"
 
So they are selling IOU's assuming future earnings? Is that it? If you buy IOU notes for cash now you will get back the cash and interest?
 
PiedPiper said:
So they are selling IOU's assuming future earnings? Is that it? If you buy IOU notes for cash now you will get back the cash and interest?
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Yeah in essence BG are just borrowing money which they will repay with interest - much the same as with any loan.
 
With absolutely no security. It is not borrowing in the usual sense.
 
If I buy one of these notes and they don't pay me back, there is nothing I can do about it.
 
Its called "burning the bondholders"!

Seriously though this is one of the ways companies all over the world finance themselves.
 
But If I borrow money and fail to repay it, they hunt me down like a rat and make me pay.
 
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