Australia's Envestra raises $150 mln in 17-yr debt

SYDNEY, March 15 (Reuters) - Envestra, Australia's biggest natural gas distributor, has raised US$150 million in
17
year debt from the U.S. private placement market, it said on Monday.

The offer was sold to two U.S. investors who asked for the long-term notes after Envestra visited them during a business update, a senior company official said.

'We didn't actually go (there) having the intention of doing anything because we don't need to raise money to refinance or for any purposes,' said Ian Little, Envestra's managing director.

But debt costs in the U.S. were too appealing to turn down.

'Pricing of the long-term issue out of the U.S. was less than what you could raise in 3-year bank debt in Australia,' he added.

Little declined to disclose the margin on the U.S. notes.

Commonwealth Bank of Australia arranged the issue, which is expected to settle this week with a delayed draw-down between now and July 1, Little said.

Envestra said its next maturity to refinance is in 2012 with A$300 million of debt. It has already put in place facilities for a 2011 bond maturity.

The U.S. private placement market is a popular source of funds for Australian companies looking for long-dated debt.

Typical buyers of U.S. traditional private placements are 'buy and hold' U.S. insurance companies keen on long-dated paper to match their liabilities.

The firm is rated BBB-minus by S&P.

(Reporting by Cecile Lefort)
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