The new package reduces the effective cost of borrowing by improving the balance of facilities between term debt and that needed to meet working capital requirements. Term debt is reduced from £903m to £310m.
The refinancing will be fully effective by the end of May.
Exceptional costs of £55m, mainly relating to the refinancing and the cancellation of interest rate swaps, will be charged to the income statement.
In an upbeat interim management statement for the period from 1 January to 8 May 2011, Barratt reports that “sales rates have returned to more normal levels” with reservations significantly ahead of the previous six months.
Barratt opened 55 new sites in the period and expects to open a further 24 or so by the end of the financial year on 30 June.
Group chief executive Mark Clare said: "We are encouraged by the improvement in market conditions we've seen since the start of 2011, following a challenging autumn period. Our strategy for recovery is progressing well and we continue to expect a substantial increase in operating profit in our second half. The successful refinancing provides a strong platform for the business and will enable us to reduce the effective cost of financing going forward."
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