Royal & Sun To Sink Further?

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  • 21 Jul 2003
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A buy-side analyst sees further downside for the bonds of Royal & SunAlliance, and a sell-sider, while slightly more positive, is hardly a bull on the credit. The U.K. insurer's 8.95% notes of '29 (Ba2/BBB) have dropped some five points following a Moody's Investors Service downgrade. They were bid at 94 last Thursday.

While speculation about a possible equity rights offering has resurfaced lately, Shoba Frey, an analyst at K Capital in Boston, doubts it will happen. "Shareholders told the company they won't support a rights issue to fill a hole, but only to support growth if the stock goes up," she says, adding that the company has either sold or is winding down many of its businesses. K Capital no longer owns the credit, and Frey sees a decent chance for a downgrade from Standard & Poor's. "They were in the 70s in March, when we bought them. They've probably rallied as far as they'll go," she says.

When asked about a possible rights offering, David Havens, an analyst at UBS Securities, said such an event could drive the bonds up close to par, but is not something investors should bank on. "There's a lot of blue water between now and September," he says. Speculation has been that an equity deal would come in September after the company announces its earnings for the first half. Karen Donhue, a company spokeswoman, declined to comment on a possible rights offering.

  • 21 Jul 2003

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 358,291.38 1348 9.06%
2 JPMorgan 320,704.66 1461 8.11%
3 Bank of America Merrill Lynch 318,128.31 1104 8.04%
4 Goldman Sachs 236,643.87 789 5.98%
5 Barclays 231,197.41 895 5.84%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 HSBC 35,007.57 165 6.53%
2 Deutsche Bank 34,880.53 120 6.51%
3 Bank of America Merrill Lynch 31,805.65 97 5.93%
4 BNP Paribas 27,920.60 169 5.21%
5 SG Corporate & Investment Banking 24,398.89 138 4.55%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 19,745.92 80 8.85%
2 Morgan Stanley 16,334.63 83 7.32%
3 Citi 15,972.34 95 7.16%
4 UBS 15,487.17 60 6.94%
5 Goldman Sachs 14,053.61 76 6.30%