The Transurban Group (ASX: TCL) share price is off to a positive start this week, with shares in the infrastructure group climbing 0.9% higher in early trade.
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What did Transurban announce today?
The group reported that its financing vehicle for the WestConnex Group (WCX) has successfully raised $4.2 billion of new non-recourse debt.
WestConnex Finance Company Pty Limited has raised $3 billion of bank term debt facilities with tenors of 3, 5 and 7 years. The new debt raise was capped off with a $1.2 billion 2-year bridge facility.
Transurban holds a 25.5% stake in WestConnex Group, having led a consortium that purchased a majority stake for $9.2 billion in 2018.
The proceeds from the latest debt raising will be used to refinance existing facilities of $4 billion, which were established when the consortium purchase went through.
Interim CFO Tom McKay was positive on the refinancing, saying it "demonstrates the underlying strength of the WCX business and has delivered a substantial reduction in WCX's funding costs."
How has the Transurban share price performed this year?
The group's share price performance has been soft this year, as the company dealt with the impact of the coronavirus pandemic.
The Transurban share price is down 7.9% for the year to $13.73 per share at the time of writing. In comparison, the S&P/ASX 200 Index (ASX: XJO) is down just 0.5% for the year.
The group's half-year profits climbed 11% higher in February before COVID-19 restrictions kicked in. That saw traffic numbers halve in May and June, as many would-be commuters settled into work from home mode.
The Transurban share price was under pressure again in August after reporting a 3.4% drop in revenue to record a $153 million statutory loss.
Foolish takeaway
WestConnex Group has taken advantage of the low interest rate environment to raise over $4 billion of new debt to continue propelling its operations forward. The Transurban share price has jumped higher in early trade on the news, giving the company a $37.32 billion market cap on current prices.
