Aquila gets $300 million credit facility

By Sara Rosenberg

New York, Sept. 6 - Aquila Inc. closed on a new $300 million credit facility due Aug. 31, 2010 that has a $175 million sub-limit for letters of credit, according to an 8-K filed with the Securities and Exchange Commission Tuesday.

Union Bank of California acted as the lead bank on the deal.

The interest rate on the credit facility can range anywhere from Libor plus 87.5 to 225 basis points, and the unused fee can range anywhere from 22.5 to 75 bps, based on ratings (see table).

Borrowings under the facility, which closed on Aug. 31, can be used to support the construction of a coal-fired power plant being developed by Kansas City Power & Light Co. near Weston, Mo., as well as to meet the company's obligation to fund pollution controls being installed at an adjacent facility.

Security is a mortgage on the assets of Aquila's Missouri Public Service electric utility division.

Aquila is a Kansas City, Mo.-based electricity and natural gas distribution utility.

Interest rates and unused fees

Ratings Libor margin Unused fee

BBB-/Baa3 or higher 0.875% 0.225%

BB+/Ba1 or higher 1.125% 0.300%

BB/Ba2 or higher 1.375% 0.375%

BB-/Ba3 or higher 1.500% 0.500%

B+/Ba3 or higher or BB-/B1 or higher 1.750% 0.625%

B+/B1 or higher 2.000% 0.625%

B or lower, B2 or lower or unrated 2.250% 0.750%

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