EDP to receive EUR 500 million in securitization of electricity tariff deficit in Portugal

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EDP to receive EUR 500 million in securitization of electricity tariff deficit in Portugal

EDP Serviço Universal, S.A., a subsidiary of EDP Group, will receive €500 million (US$544.4 million) from Tagus Sociedade de Titularização de Créditos, S.A. for a portion of the 2014 tariff deficit in Portugal.

The 2014 tariff deficit resulted from the deferral, for the period of 5 years, of the recovery of the 2014 over costs, including the adjustments for 2012 and 2013, related to the acquisition of electricity from special regime generators. The outstanding amount of the 2014 tariff deficit due to EDP Serviço Universal before this agreement was approximately €1.25 billion.

Tagus will finance this transaction through the issuance of €500 million of senior notes with a yield of 2%, coupon of 1.99%, and an expected rating of A1/BBB/BBB High, attributed by Moody’s, Fitch and DBRS. The issuance of such debt instruments is subject to CMVM’s asset code attribution and prospectus approval, and expected to be admitted to trading on NYSE Euronext Lisbon.

The transaction has been solely arranged by StormHarbour Securities LLP and joint lead managed by Banco Santander Totta S.A., Deutsche Bank AG, London Branch, J.P. Morgan and StormHarbour Securities LLP.

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