InterContinental Hotels has entered a floating-rate swap to convert part of a recent EUR600 million (USD702 million) 10-year bond. Anthony Stern, head of treasury in London, said it is the firm's policy to hedge around half of the liabilities. He added it would consider hedging more of the bond if swap spreads and absolute rates rise.
In the swap, InterContinental Hotels pays a floating-rate of some 95 basis points over swaps and receives the 4.75% coupon on the bond. The maturity of swap matches that of the bond. JPMorgan, HSBC and The Royal Bank of Scotland were the bookrunners on the bond. Stern declined to name the swap counterparties.
