| Group | Company | |||
| 31 December 2004 £m |
31 December 2003 £m |
31 December 2004 £m |
31 December 2003 £m |
|
|---|---|---|---|---|
| Other creditors | 133 | 5 | ||
| Bank loans (secured): | ||||
| Between one and five years | 1,330 | 262 | – | – |
| Over five years | 1,638 | 442 | – | – |
| Total bank loans | 2,968 | 704 | – | – |
| Preferred equity facility | 154 | – | – | – |
| 2% Convertible US Dollar Bonds 2005 | – | 62 | – | – |
| 3.75% Convertible US Dollar Bonds 2023 | 129 | 138 | – | – |
| Total bonds | 129 | 200 | – | – |
| Total creditors: amounts falling due after more than one year | 3,384 | 909 | – | – |
Preferred equity facility
The preferred equity facility comprises US$300 million in preference shares issued by Impala Magpie Limited to Mitsui Power Ventures Limited for the purposes of financing the acquisition of the EME portfolio.
Impala Magpie Limited is a 70% owned subsidiary of International Power plc and Mitsui Power Ventures Limited is a wholly-owned subsidiary of Mitsui & Co of Japan. Mitsui Power Ventures Limited is International Power's partner in IPM Eagle LLP, which is the new owner of the acquired EME portfolio.
The preference shares entitle the holder to a preferred dividend coupon of USD LIBOR plus 2%. The preference shares are redeemable from 16 December 2008 and may also be redeemed if funds become available following the sale of certain assets.
International Power (Impala) Limited, a wholly-owned subsidiary of International Power plc has granted Mitsui Power Ventures Limited a put option to sell 70% of the Preference Shares it holds on the date of exercise. The put option is exercisable in certain circumstances, including where Impala Magpie Limited fails to redeem the Preference Shares on maturity.
International Power plc has agreed to guarantee International Power (Impala) Limited's obligations to Mitsui & Co of Japan and Mitsui Power Ventures Limited.
3.75% Convertible US Dollar Bonds
On 22 August 2003, International Power (Jersey) Limited, a wholly-owned subsidiary company incorporated in Jersey, issued US$252.5 million 3.75% convertible notes due 2023, convertible into preference shares of International Power (Jersey) Limited at the holder's option, immediately exchangeable for Ordinary Shares of, and unconditionally guaranteed by, International Power plc.
The notes are convertible into Ordinary Shares of International Power plc at a conversion price of 200p at any time between 2 October 2003 and 12 August 2023. Each US$1,000 principal amount of notes will entitle the holder to convert into a US$1,000 paid up value of preference shares of International Power (Jersey) Limited.
The notes may be redeemed at the holder's option at their principal amount, together with accrued interest, to the date fixed for redemption.
If the conversion option is not exercised, the convertible unsecured notes will be redeemed on 22 August 2023 at a redemption price equivalent to their principal amount.
Premium on redemption of convertible bonds
Provision is made for the possible premium on redemption of the 2005 and 2023 convertible bonds. This is included within the carrying amount of the bonds. At 31 December 2004, the amount accrued was £1 million (31 December 2003: £4 million). The finance cost charged in the profit and loss account comprises the aggregate of the coupon on the convertible unsecured notes and the proportion of the premium on redemption that relates to the financial year.