Lisbon, March 5, 2025 (Lusa) - Portugal’s flag carrier airline, TAP, is to issue a further €200 million in bonds, maturing in 2029 and with an interest rate of 4.467%, after having already issued €400 million last October.
"Transportes Aéreos Portugueses [...] has successfully completed the pricing of 5.125% Senior Notes with an aggregate nominal value of €200,000,000 maturing in 2029 (the ‘Additional Notes’) at a final acquisition price of 102.750% and an interest rate until maturity of 4.467%,’ TAP said in a statement.
According to the statement, these ‘Additional Notes’ will be issued under the indenture governing the 5.125% Senior Notes with an aggregate nominal value of €400,000,000 and maturing in 2029 (referred to as the ‘Existing Notes’).
"The success of this transaction confirms the strong commitment of current and new investors in TAP, allowing us to issue, in a private offering and with a small number of investors, half the amount issued in October last year," says the company's chief financial officer (CFO), quoted in the statement.
According to Gonçalo Pires, "the significant decrease in the interest rate to maturity compared to the initial issue, an even more marked decrease compared to the 2019 issue, reinforces investor confidence in TAP".
"We managed to decrease the spread to the benchmark (the 2.500% OBL maturing on 11 October 2029) from 288 basis points in October last year to 227 basis points, confirming a strong creation of credit value, especially considering the spread of 634 basis points against the benchmark (the 0% OBL maturing on 18 October 2024) achieved as part of the 2019 issue," the CFO details.
The issue of the ‘Additional Bonds’ is due to take place next Friday, and these constitute "a single class of debt securities with the “Existing Bonds” under the indenture, including with respect to waivers, amendments, redemption and tender offers, unless otherwise specified".
The gross proceeds from the offering of the ‘Additional Bonds’ - which are offered exclusively outside the United States in offshore transactions in reliance on Regulation S under the Securities Act - will be used "for general corporate purposes and to pay certain fees, costs and expenses associated with the particular offering."
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