France Télécom's capital restructuring in early 2003 reached all parts of the capital markets, reflected in it being chosen as the favourite deal of bond, equity and loan bankers.
FT announced its restructuring plans in December 2002 and when the first leg was launched, the demand for its five, 10 and 30 year bonds impressed both the debt and equity markets — the Eu5.5bn of bonds attracted over Eu14bn in orders.
This allowed France Télécom to pay down the drawn portion of its Eu5bn and Eu10bn revolvers and replace them with an undrawn Eu6bn three year revolving credit.
Demand was further boosted by a successful rights issue, which at Eu15bn was a European record, and was priced at a discount of 28% to the company's closing share price the day before the deal was launched — most rights issues in the two years before had been priced with a 40%-50% discount.
|European Investment Bank|
The bond issues of the European Investment Bank (EIB) were the second most popular deals chosen by bankers. The EIB's Eu4bn trade last year was one banker's favourite transaction; the paper matures in 2020 and pays a coupon of 4.625%.
One star went back to 1994, though, for his most memorable offering; the EIB's Greek drachma transaction — the first ever so-called Marathon bond.
Seat Pagine Gialle
The leveraged buy-out of Italian yellow pages company Seat Pagine Gialle broke all European LBO records in 2003, and was the third most popular deal among bankers.
BC Partners, CVC, Permira and Investitori Associati paid Eu5.7bn for Seat, in the largest ever European LBO — a record only taken this year by the Eu12.2bn buy-out of Italian telco Wind.
With Eu3.2bn of senior debt and Eu1.2bn in high yield bonds, the leads Barcap, BNP Paribas, CSFB and RBS had their work cut out.
However the deal was a blowout success, attracting an impressive number of institutions in syndication.