STATE-OWNED energy company Bord Gáis Éireann has borrowed €550 million through a bond sale to European corporate investors.

In the second of three such moves, the company said yesterday it had raised €550 million from institutional investors. It intends using the cash to fund its expansion plans.

In a statement yesterday, Bord Gáis said its offer was “significantly oversubscribed”.

Chief executive John Mullins said the company was “pleased” with the outcome of the transaction. “This funding allows us to progress with our ambitious growth strategy, which currently has a number of significant investment projects under way,” he said.

The company is investing more than €400 million in a new electricity generating plant in Cork harbour that will have the capacity to supply power to up to 400,000 households. It recently entered the domestic electricity market in competition with State player the ESB and with Airtricity, the Scottish and Southern Energy-owned independent operator.

Bord Gáis supplies natural gas to 630,000 households and a large number of small and medium-sized businesses, and operates the State’s natural gas network.

It plans to continue developing as a “dual-fuel” supplier of gas and electricity, and to buy or develop alternative energy businesses.

Bord Gáis’s capital spending was €318 million in 2008, up from €204 million in 2007.

Its net debt increased to €1.2 billion in 2008 from €1.15 billion in 2007. The Oireachtas last year voted to increase its borrowing limit to €3 billion from €1.7 billion.

Last March, the company raised $450 million (€320 million) from US institutional investors.