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October 16, 2009
Nets arena snags equity, bonds near market
ProjectFinance
The developer of a new arena for the Nets basketball team in Brooklyn, New York, has lined up an equity commitment from Mikhail Prokhorov's Onexim Group. It is set to come to market shortly with a roughly $700 million tax-exempt bond issue for the arena. Assured Guaranty, the last remaining viable monoline, is in line to insure the bonds.
"In line" is overstating the case, at least according to The Wall Street Journal.
The issuer and its underwriter Goldman Sachs are targeting a bond coupon of about 6.5%, or roughly 220bp over where the 30-year treasury currently stands. Project and municipal finance issuers have encountered strong issuer appetite in recent months, though spreads have widened in the last two weeks. Assured is rated AAA/Aaa by S&P and Moody's, though Fitch recently downgraded it for a second time, to AA-.
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Posted by eric at October 16, 2009 12:50 PM