Casino Guichard-Perrachon, a French company that operates a wide variety of grocery and general retail stores, has entered an interest rate swap on a recent EUR500 million (USD510.42 million) bond offering to convert it into a synthetic Euribor-based floating-rate liability. Pascal Announ, group financial director in Sainte-Etienne, France, said it is company policy to convert all fixed-rate risk into floating-rate and then separately manage its interest rate exposure, using structured derivatives, such as caps and floors.
Announ said the company is receiving the 57Ž8% coupon on the bond, but declined to disclose the floating-rate it is paying in the swap. Deutsche Bank, Natexis Banque Populaire, HSBC and BNP Paribas were the counterparties on the swap. They were chosen because they were the underwriters on the bond offering, Announ explained.
