AXA Investment Managers, which manages roughly £16 billion in fixed-income assets, has been, and will continue to accumulate shorter-dated triple-B rated paper, mostly from the primary market. Denis Gould, head of the sterling investment-grade team, says he is especially interested in seeing new issuance fromNetwork Rail, the not-for-profit company established by the British government to replace Railtrack, which was put into receivership last year. Network Rail is expected to issue debt to pay off existing Railtrack debt and to fund project work. Gould is also anticipating long-dated issuance from LCR, the company that runs the channel link tunnel.
AXA has added recent new issues from Imperial Tobacco, E.ON, RWE and Ford. The firm added Imperial Tobacco because it is not exposed to the litigation in the U.S. The two utilities were bought for their yield and Ford was added as a U.S. recovery play. The firm has also added the Dutch supermarket groupAhold's 6.50% of '17. AXA is also overweight telecoms, with its biggest position being British Telecommunications for its attractive spreads. The firm has also been adding France Telecom's '05s and '11s, which feature step up covenants. Gould says he does not think FT will go sub-investment-grade. The firm uses a variety of benchmarks.
