Partner Article

Drax agrees £75m amortising loan facility

Selby-based Drax has announced that it has agreed a £75 million amortising loan facility maturing in June 2018 with Friends Life, underpinned by a guarantee from HM Treasury issued under the Infrastructure UK Guarantee Scheme.

This loan facility replaces £50 million of the £100 million amortising loan facility agreed with the UK Green Investment Bank, which was signed in December 2012.

The facility enhances the financing structure executed last year by providing additional liquidity to the Drax Group, securing HM Treasury support for the company’s plans to convert three generating units from coal to biomass and ensuring a smoother profile of debt maturities across the structure.

Commenting on the new facility, Tony Quinlan, finance director of Drax said: “This further strengthens our balance sheet, as we progress our project to transform the largest coal-fired power station in the UK into an electricity generator fuelled predominantly by sustainable biomass.

“The benefits are multiple, from securing jobs at Drax and across the UK in the supply chain to providing low carbon, cost effective and reliable renewable power for the consumer.”

Mark Versey, chief investment officer at Friends Life, said: “We are pleased to work together with Drax and HM Treasury and support the Infrastructure UK Guarantee Scheme as an institutional investor.

“This investment demonstrates Friends Life’s ability to explore infrastructure and other alternative investment opportunities to ensure Friends Life remains competitive and nimble in a changing market.”

This was posted in Bdaily's Members' News section by Mark Lane .