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Derivatives

Invensys Eyes FX Swaps On Back Of Refinancing Plan

Invensys, a troubled U.K. technology manufacturer, recently completed a refinancing package and is considering converting a proportion of the USD550 million and EUR475 million (USD580 million) debt to sterling.

Invensys, a troubled U.K. technology manufacturer, recently completed a refinancing package and is considering converting a proportion of the USD550 million and EUR475 million (USD580 million) debt to sterling.

The aim with the group's currency risk strategy is to match liabilities to cash flow, said Will Spinney, group treasurer in London. "We will be looking to swap a certain amount of the debt within a month or so," he added. Spinney explained the corporate also enters interest rate swaps, but as part of its policy to maintain a match between fixed and floating assets and liabilities.

Deutsche Bank is the sole underwriter of the refinancing deal. Both issues pay a coupon of 9.875% and mature in 2011.

Moody's Investors Service downgraded the manufacturer to B3 from Ba3 on Feb. 23. Standard & Poor's cut the rating to B plus from BB minus and placed it on negative outlook two days later.

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