BNP Paribas

A bevvy of public sector borrowers are lining up euro deals for Tuesday and beyond — but some are opting to hold back price thoughts amid a cluttered and volatile backdrop.

B&B Hotels, France’s third largest budget hotels group, launched a covenant-lite senior term loan to early birds this week, backing its €800m buyout by PAI Partners from the Carlyle Group and Montefiore Investment.

Atalian Global, the French facilities management company, on Monday opened the first roadshow of 2016 for a high yield bond in Europe, as it announced the acquisition of US peer Temco Facility Services.

BBVA, BFCM and BPCE met with strong investor demand for euro senior unsecured deals on Monday, as peripheral and longer dated debt proved no deterrent to buyers.

The euro senior unsecured market finally came to life on Friday, with investors swarming all over a landmark BNP Paribas seven year and a large Rabobank floater.

One of BNP Paribas' most senior debt bankers, Tim Drayson, has left the firm.

Just as European equity capital sales made a prompt start to the year on Tuesday, the first viable window available, with the €1bn NN Group block trade, the equity-linked market also wasted no time. Safran, the French aerospace and defence company, issued a €650m convertible at what a banker claimed was a record low yield.

Borrowers who issued covered bonds this week that are eligible for the European Central Bank’s purchase programme (CBPP3) did not receive such a strong reception as those whose bonds were not eligible.

A healthy euro benchmark pipeline is building for next week, with one supranational looking to print and a pair of sovereigns believed to be considering deals, after a week that didn’t finish as strongly as it started for core issuers.

KfW raised €3bn with a slow burning seven year benchmark on Thursday, leaving SSA bankers wary about the threat of over saturation in the currency as several issuers mull deals for next week.

Wednesday brought red back to equity traders' screens after a buoyant Tuesday, but trading action confirmed the satisfactory execution of this year’s first two substantial equity capital markets deals in Europe: the €1.03bn block trade in NN Group, the Dutch insurer, and French aerospace firm Safran’s €650m convertible.

Investment grade loan pricing has stopped falling — meaning the flow of refinancing deals is ebbing. Mergers and acquisitions, as ever, are what banks want, and they are confident of getting more in 2016. But will banks finally get round to weeding out unprofitable relationships? Rob Cooke reports.