Gas Networks Ireland to redeem €500m of bonds early

Bond buyback set to be financed by recent debt sale at more favourable rates

Ervia's Gas Networks Ireland unit has decided to exercise an option to redeem €500 million of bonds ahead of their scheduled repayment date in April.

The company, which is a sister company to Irish Water, is entitled to buy back the bonds in December 2016 and is prepared to pay holders of the bonds a 4.2 per cent premium for every €1 they are owed. The bonds carry an annual coupon, or interest rate, of 3.625 per cent.

The move comes only weeks after Gas Networks sold €625 million of bonds to help raise funds for the repayment.

The transaction, which saw the company sell 10-year bonds to carry a coupon of 1.375 per cent and 20-year bonds at a 2.25 per cent rate, marked the first debt sale under its new corporate structure since its parent sold off its Bord Gáis Energy unit in 2014 for €1.1 billion. UK power group Centrica led a consortium of bidders that acquired the division.


The Bord Gáis group was subsequently renamed Ervia.

Gas Networks Ireland operates a network of over 13,832km of gas pipeline around Ireland as well as two sub-sea interconnectors.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times