Viridian’s New York owners in line for €66m dividend amid debt refinancing

Belfast-based energy group Viridian plans to pay a €60 million dividend up to its ultimate parent group, majority owned by US private equity firm I-Squared, as it undergoes a refinancing of its debt.

The onwner of electricity and gas supplier Energia and Power NI has confirmed it plans to redeem in full its €540 million of existing bonds and issue the equivalent of €600 million of cheaper notes, denominated in sterling and euro.

The company plans to pay a £60 million (€66mn) dividend to its recently-formed Cayman Islands-based parent, Viridian Topco Limited, which was set up by I-Squared earlier this year as it sold a minority stake in Viridian to an unknown investor.

The existing debt, issued in February 2015, carries a 7.5 per cent interest rate and Viridian's chief executive Ian Thom noted on a call with analysts late last month that its rivals' funding costs are currently below 4 per cent, given how bond yields have fallen in the past two-and-a-half years.

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Viridian passed a milestone on September 1st where it could exercise an option for early redemption of the debt, which was ordinarily not due to mature until 2020.

I-Squared, founded in 2012 by former executives from Morgan Stanley, bought Viridian in an estimated €1 billion deal last year from Bahrain’s Arcapital Bank, which owned the power company for almost decade.