Tobacco Giant CDS May Face Orphaning Woes

A business reorganization at U.S. cigarette maker Altria may see debt retired and credit protection holders with worthless contracts--a phenomenon known as orphaning.

  • 14 Jul 2006
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A business reorganization at U.S. cigarette maker Altria may see debt retired and credit protection holders with worthless contracts--a phenomenon known as orphaning. Traders said players long protection/short Altria bonds are closely following discussions the company may split into three entities.

Last Friday, it looked likely Altria would break away from subsidiary Kraft Foods as well as demerge its tobacco business into Philip Morris USA and Philip Morris International. While Kraft CDS already trade as stand-alone debt, it is unclear how Altria debt will be divided or restructured. "This would likely be a succession issue," said one trading official.

A surge in corporate take-over activity has highlighted CDS orphaning problems in the last few months (DW, 5/5). The International Swaps and Derivatives Association has been hosting dealer discussions on the issue with a view to drafting a supplement to the 2003 credit derivative definitions which will amend so-called successor language.

  • 14 Jul 2006

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 16 Jan 2017
1 Citi 22,118.13 61 9.00%
2 Barclays 20,987.41 55 8.54%
3 JPMorgan 17,406.75 53 7.08%
4 HSBC 16,333.52 48 6.64%
5 Goldman Sachs 15,454.74 49 6.29%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Commerzbank Group 114.00 1 66.16%
2 CaixaBank 37.05 1 21.50%
3 UniCredit 10.62 1 6.17%
3 BNP Paribas 10.62 1 6.17%
Subtotal 172.30 3 100.00%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 SG Corporate & Investment Banking 770.06 2 16.80%
2 Goldman Sachs 656.16 2 14.32%
3 JPMorgan 527.28 4 11.50%
4 Emirates NBD PJSC 408.38 1 8.91%
5 Deutsche Bank 321.53 3 7.01%