The Municipal Electric Authority of Georgia has entered interest-rate swaps to hedge a USD126 million subordinated bond issuance. Proceeds from the issue refund debt associated with MEAG's Project One portfolio of generation assets, which includes four nuclear plants, four coal plants and an 8% stake in a transmission system. The notes are secured by those assets.
Jim Fuller, cfo in Atlanta, said MEAG entered into swaps contracts with underwriter Bear Stearns to get fixed rates on these specific issues between 3-4%. The underlying notes are due at four different dates between 2019 and 2022. The entity which provides bulk electric power to 48 cities and one county in Georgia, has USD3.6 billion in outstanding debt.
