power firms assets on the line, page-3

zen, where did you get that from? I notice that it is unsigned! It is also far from the truth and obviously devised to ramp bbp down. Sometimes I think the media and the shorters are one to themselves.

The facts are bbp's loans have always been secured by the infrastructure and 86% is hedged against interest rate rises. So they will pay a bit more interest for 15% of the loan. $360m of the loan is corporate and will cost more interest. BNB has offered to provided that cheap if the banks charge too much. BPP estimates the average interest on the whole $3.1b is 8%. This is not much different from the existing finance arrangements and is covered by the revenue.

Much of the hype has been over the additional $375m needed to complete the 380 MW Tamar Valley power plant. But these are on going construction costs (not debt) and they only need $150m in 2008 and the rest in 2009 when it will power up and produce income. I reckon they should ask BNB for the $150m too. The rest can be raised through asset sales, a cheaper loan or a cap raising in the second half of 2009.

I reckon the BBP refinancing is a storm in a teacup and has been hyped for the benefit of the hedge funds that are short on BBP.

cheers...