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Thursday October 13, 2005

TNB signs credit facility to help cut foreign debt

KUALA LUMPUR, Malaysia: Tenaga Nasional Bhd. signed a US$500 million (euro416 million) multi-currency credit facility Thursday as part of efforts to reduce its foreign debt. 

Tenaga wants to refinance more of its foreign-currency borrowings with ringgit debt to match its largely ringgit-based revenue, Chief Executive Che Khalib Mohamad Noh told reporters. 

The facility "will give us flexibility to convert foreign debt to ringgit debt,'' Che Khalib said after Tenaga signed an agreement to take a revolving credit facility that allows borrowings in U.S. dollars, British pounds, euros and ringgit. 

Tenaga has more than US$15 billion (euro12.5 billion) in foreign currency debt, and has suffered volatile earnings because of unrealised foreign exchange losses from the foreign debt. 

Che Khalib couldn't say how much foreign exchange savings the facility would generate, noting it will depend on what currencies Tenaga chooses to borrow in and the timing of any conversions. 

UOB Malaysia, the local arm of Singapore's United Overseas Bank Ltd., is the lead arranger of the credit facility. - AP 

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