TAQA, which is 75 percent owned by the government of Abu Dhabi, has picked Bank of America, RBS, Standard Chartered and Mitsubishi UFJ to arrange investor meetings in Asia, London and the United States after which the company may issue a bond under its global medium term notes program, subject to market conditions.
Roadshows kick off in Hong Kong on Nov. 24 and conclude in Boston on Nov. 30, arranging banks said in an announcement, seen by Reuters.
Citi and RBS are arranging the tender, which is being offered to bondholders at a price of 103.75. The 5.62 percent October 2012 bond was bid at 103.150 just after the tender announcement on Monday, according to Thomson Reuters data.
"TAQA has bonds maturing - we are offering to buy them back from investors," an official at TAQA told Reuters, requesting anonymity.
Last month, TAQA's chief financial officer said the company had secured regulatory approval for its 3.5 billion ($1.1 billion) Malaysian ringgit bond program, but may also tap the conventional bond market next year to refinance debts.
TAQA's debt includes $3.5 billion in maturing bonds and $500 million in bank credit. The company had a debt ratio of 79 percent with a stated target of 70 percent.
No further details on the size or maturity of the new bonds are likely to surface ahead of the roadshows, but buying back near-term bonds and issuing new notes will extend the company's maturity profile and keep debt levels under control.
"It's all about debt management, to benefit their overall debt position. Combined with the new issue it will take out the near-term maturity so, effectively, it is raising new money to repay the existing debt," said a source at an arranging bank.
Shares in TAQA are nearly 18 percent down this year although its third-quarter profit more than doubled, aided by higher crude oil prices.
TAQA, along with state-owned investment vehicles International Petroleum Investment Co (IPIC), Mubadala and Tourism Development and Investment Co. (TDIC), is considered one of Abu Dhabi's strategic companies.
