FINANCE Fitch rates Viridian bonds BB-
RATINGS agency Fitch has categorised Viridian’s €600m-worth of senior secured bonds as BB-, two notches below investment grade credit.
The Belfast-based energy provider launched the bond sale earlier this week as it moved to take advantage of ultra-cheap borrowing costs by redeeming €540m of existing paper and replacing it with cheaper notes denominated in sterling and euro.
Viridian – the owner of electricity and gas suppliers, Energia and Power NI – provides energy to close to 720,000 customers, according to its annual report. It was acquired in 2016 for €1bn by global infrastructure investor, I Squared.
In its rating note Fitch highlighted Viridian construction of additional wind farms will add 75mw of wind capacity “within the next 18 months, taking the [group’s] total to 300mw and lowering the build risk”. It also forecast an expansion of the power company’s dividend stream in 2019 as recently acquired assets bolster revenue.
In the past year Viridian has embarked on a buying spree snapping up three companies in the North with a total of 64 megawatts of windfarm assets under development for a combined £18m.
The group’s CEO, Ian Thom, raised the issue of its relatively expensive debt on a call to analysts last month and noted rivals avail of funding costs at below 4pc. Viridian’s existing bonds, issued in February 2015 carry a 7.5pc interest rate. Its new sterlingdenominated notes are due to mature in 2024 while the euro denominated paper matures in 2025.