NBN Co raises $6.1bn in private financing
NBN Co has secured $6.1 billion in private sector financing as it prepares for its eventual privatisation.
The company has exceeded its plan of raising $2 billion in additional financing, as stipulated in its 2020–2023 corporate plan, by $4.1 billion.
The funding will be used by the company to start the process of refinancing its $19.5 billion debt facility with the government by mid-2024.
Finance Minister Mathias Corman said the additional financing will allow NBN Co to pay down this loan without jeopardising its performance.
“NBN Co approached the bank market with a request for an initial $2 billion, as foreshadowed in its 2020–23 corporate plan. Given the positive response from the market, NBN Co has secured additional lines of credit totalling $4.1 billion at very competitive prices,” he said.
“There is no requirement for NBN Co to draw down on these additional facilities immediately, but the government agrees with the company that it makes sense to have these facilities in place, to give it flexibility and given current economic conditions.”
The additional financing will also allow NBN Co to complement the federal funding for the nbn project, which is capped at $49 billion.
The company is expected to draw down $2 billion from the $6.1 billion raised to date to complete the nbn build within its $41 billion funding envelope.
Around $1.5 billion of the additional debt facilities will be reserved for working capital, with the balance available for repayment of the loan and strategic investments expected to accrue a positive return beyond the initial rollout phase.
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