BayernLB, ING and LBBW are arranging the transaction, offering investors five, seven and 10 year fixed and floating rate notes. The fixed notes will be priced at 105bp-120bp, 130bp-145bp and in the area of 160bp over mid-swaps. The floating rate note ranges are 10bp tighter, at 95bp-110bp, 120bp-135bp and 160bp over six month Euribor.
The 10bp difference in spreads between fixed and floating rates has been set to compensate for the difference between mid-swaps and six month Euribor, according to a banker familiar with the deal. The aim is to put the fixed and floating rate pricing at equal starting levels, in line with Schuldschein market convention.
Porsche’s deal is a green transaction. A translation of a section in the term sheet states: “This Schuldschein will be used to finance suitable green projects such as research and development in the field of electromobility and the production of battery-powered vehicles.”
The initial target is €300m, though that could increase if investors show interest.
“This is attractive pricing, unquestionably, and it looks as though Porsche is looking for size,” said a banker following the deal.
Last time Porsche AG was in the market was in February 2018, when it sold one of the tightest transactions of the year. LBBW sold €280m of five, seven and 10 year euro debt at margin ranges of 50bp-60bp, 65bp-75bp and 80bp-90bp.
Almost exactly two years before that Porsche had launched a €200m Schuldschein that grew to €1.1bn after more than 150 investors — just under half of them foreign — bought tickets.
That time, the pricing margins offered by leads LBBW and UniCredit on the three, five and seven year tranches were 120bp-140bp, 140bp-160bp and 160bp-180bp in fixed and floating rates.