Although tiny in volumes and deal sizes, compared to public bond markets, the Euro private placement market has been a big success since its birth almost four years ago. Under the watchful guidance of the Banque de France and other authorities, as well as leading bankers, lawyers and investors, the market has gone from zero in 2012 to over €7bn outstanding. It has become a mainstream source of capital for French borrowers, especially mid-caps, and an attractive alternative to yield-hungry investors. Like its German cousin, the Schuldschein market, it is also attracting a higher proportion of international borrowers and investors than ever before.
However, challenges remain, not least what happens when interest rates start to go up and investors face a greater choice of investment opportunities. There are also concerns as to what happens when the credit cycle turns and how this market, so far untested and much of it unrated, will cope with bankruptcies and messy workouts.
GlobalCapital invited some of the Euro PP market’s leading players, including issuers, investors, bankers, lawyers and regulators, to a roundtable in Paris on November 19 to discuss these topics and many more.
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