Woodside Energy has raised $US2 billion ($3 billion) on the US bond market overnight, to be used partly to fund the $US2.35 billion acquisition of a clean ammonia project in Texas and the $US900 million purchase of a prospective LNG export terminal in Louisiana.
The raising comprises two tranches – $US1.25 billion of 10-year bonds with a coupon of 5.1 per cent, and $US750 million of 30-year bonds with a coupon of 5.7 per cent.
Woodside said the money would be used for “general corporate purposes”, while Standard & Poor’s reported it would partially fund the two US acquisitions.
“We believe these acquisitions will diminish Woodside’s financial capacity,” said S&P, which rated the notes BBB+. “However, the company can absorb the immediate impact of an additional $US3.25 billion in acquisitions over the next 12 months. Woodside’s ability to balance growth projects with financial policy objectives will be fundamental to rating stability over the next few years.”
Moody’s, which rated the bonds Baa1, noted Woodside was developing multiple projects and has a guide for capex this year of $US5 billion to $US5.5 billion.
“The organic and inorganic growth initiatives will keep execution risk and capital spending elevated,” it said while adding it did not expect Woodside’s credit quality to materially weaken.
