Wind energy Gamesa signs a ?1.2 billion syndicated loan due 2014-2016

The loan injects visibility into Gamesa’s financing: the first principal payment is not due until 2014, while almost half of the loan (€500mn) is 5-year paper. The proceeds are sufficient to cover, eliminating uncertainty, all capex planned for each line of business under the 2011-2013 Business Plan. The company has additional undrawn credit lines totalling €1 billion, while leverage is an optimal 0.9x (net debt/EBITDA ratio at 31 March 2011). 

Gamesa, a global leader in the design, manufacture and maintenance of wind turbines and a benchmark wind farm developer, signed a new €1.2 billion syndicated loan with 24 banks, refinancing the existing loan due October 2012. The terms of the new loan provide for staggered principal repayments between 2014 and 2016, with a total of €568 million falling due in 2014, €131 million (the European Investment Bank tranche) maturing in 2015 and almost half, €500 million, not due until 2016.

With this loan arrangement, Gamesa has injected stability in terms of credit availability and longer-term financing visibility and covered, eliminating prevailing credit market risk factors, the business capex programs (WTG manufacture, offshore technology and the development and construction of wind farms) laid down in its 2011-2013 Business Plan for all its operating markets (Europe, the US, China, India and Latin America).

By closing this agreement, the bank syndicate has effectively ratified its commitment to the Gamesa endeavour, refinancing the full amount at a similar cost to the 2009 syndicated loan, while stretching out the repayment terms in time.

The deal was lead arranged by eight financial institutions (BBVA, Santander, Bankia, Barclays, La Caixa, Citigroup, ING and Lloyds) which syndicated it to another 16 Spanish and international banks (Banco Popular, Sabadell, Commerzbank, Banesto, BNP, Royal Bank of Scotland, Caja Navarra, West LB, Unicaja, BBK, Banca March, Bankinter, Bankoa, Caja Laboral, Caja Vital and Cajastur).

In terms of liquidity, Gamesa also has around €1 billion in other undrawn credit facilities. The company’s leverage ratio, expressed as net debt as a multiple of EBITDA, stood at 0.9x at the first-quarter close, one of the lowest in the wind power sector.