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Wed 17 Oct 2007 09:51 AM

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Taqa plans US bond issue

Abu Dhabi National Energy Company to sell a benchmark-sized bond to help pay for $8bn in acquisitions.

Abu Dhabi National Energy Company (Taqa) plans to sell a benchmark-sized bond in the US to pay for some of the $8 billion in acquisitions announced since May, a source familiar with the deal said.

The company started making presentations to investors on Tuesday. The roadshow ends on Thursday, the source told Reuters on Tuesday, adding the sale would comply with the Securities and Exchange Commission's 144a rule that governs private placements.

Benchmark size bonds are typically of at least $500 million.

"We are looking at a variety of ways to finance the acquisitions we have made," Eva Janssens, Taqa's head of Treasury & Corporate Finance said, declining to comment on the bond sale.

Taqa has announced acquisitions worth almost $8 billion in the last six months, including a proposed C$5 billion dollar ($5.12 billion) takeover of Canadian oil and gas producer PrimeWest Energy Trust.

The bond sale is taking place despite a lingering credit squeeze triggered in July by defaults on US home loans.

Last week, bankers told Reuters that Gulf borrowing would likely be subdued until next year, with mostly sovereign-backed debt likely to hit the market in the meantime.

Taqa is 75% owned by the government of Abu Dhabi, the world's sixth-largest oil exporter.

In June the firm said it would sell $9 billion of bonds over five years to finance expansion through a medium term note programme.

On Monday, ratings firm Moody's assigned a provisional Aa2 rating to the firm's programme, citing the company's strong state support for the relatively high rating.

Citigroup is managing the sale, which will include tranches of 5-year and 10-year bonds, the source said. - Reuters

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