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GC Asia
The View
Coronavirus no match so far for ECB in corporate bonds
The Covid-19 coronavirus outbreak has become prevalent enough in Italy to lead to a quarantine of around 10 towns.
25 Feb 2020
Corporate Bonds
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Investment Grade
India’s Adani weighs up Schuldschein debut
Adani Group, the Indian conglomerate founded by Gautam Adani, is considering a non-deal roadshow to Schuldschein investors, as Western private debt markets gain ground with companies in Asia.
25 Feb 2020 -
High Grade
Lundbeck to make bond debut after drug news
H Lundbeck, the Danish pharmaceutical company, has mandated banks for a five year debut euro benchmark from its new bond programme, after gaining US regulatory approval for a new migraine treatment.
25 Feb 2020 -
Private Debt
Severn Trent to sell PPs after Ofwat decision
Severn Trent, one of the UK’s three listed water companies, is looking to sell US private placements via its holding company, according to market sources.
24 Feb 2020 -
High Grade
Virus makes high grade corporates splutter
The rise of the Covid-19 coronavirus in Italy has tapped the brakes on the zooming high grade corporate bond primary market.
24 Feb 2020
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Bond investors are playing with fire
Asia’s bond market has had an undeniably stellar start to 2020. Despite the spread of the novel coronavirus, now named Covid-19, investors are continuing to buy bonds at remarkably tight prices as issuance accelerates. But the non-stop enthusiasm raises a serious question — are market participants too positive?
24 Feb 2020 -
Suzano tempted by Enel-like structure, Mexico markets SDG bond
Brazilian pulp and paper company Suzano is working on structuring a bond that would reflect its commitment to sustainability. But its chief financial officer told GlobalCapital that the green bond market was unable to maximise the impact capital markets could have on sustainability.
20 Feb 2020 -
Superlatives fly as Swiss funds cry for bonds
Intense demand in the Swiss franc bond market for any asset with a positive yield — or even anything yielding more than the penal negative rates on cash — gave a varied group of issuers this week execution that pushed the boundaries — bigger, faster and tighter.
20 Feb 2020 -
ECB is revving the engine but the handbrake is on
Europe’s capital markets are back in super-demand mode.
20 Feb 2020 -
HSBC’s restructuring: is it enough though?
HSBC’s corporate finance staff have survived its restructuring largely unscathed, but the more ambitious among them will see the bank’s plans as a missed opportunity, writes David Rothnie. And with no answer yet on the identity of the next full-time CEO, the uncertainty is not over.
20 Feb 2020 -
US firms cram into market, accelerate bonds
US corporate bond issuers set a blistering pace this week as crowded into the market in droves after Monday’s Presidents’ Day holiday.
20 Feb 2020 -
Water companies re-enter market fray after Ofwat purgatory
UK water utility companies have begun to test public and private debt markets for the first time since regulator Ofwat’s price review, and the deadline to appeal it, passed. The regulator’s decision will have large ramifications for the companies’ profiles in capital markets, writes Silas Brown.
20 Feb 2020
Bond Comments
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STLC USD550m 4.95% Feb 26
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DP World USD500m 3.75% Jan 30, USD500m 4.7% Sep 49
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Sibur USD500m 3.45% Sep 24
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IHS USD500m 7.125% Mar 24, USD800m 8% Sep 27
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EPIF EUR600m 1.698% Jul 26
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MMK USD500m 4.375% Jun 24
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NEPI EUR500m May 23 3.125%
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GTLK USD500m 6.125% Apr 25
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Evraz USD700m 5.25% Mar 2024
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Almarai USD500m 4.311% Mar 24
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Reverse Yankees dazzle in red hot corporate market
US bond market tourists poured into high grade euros this week, where tiny concessions and a cheap overall cost of funding saw a string of successful trades.
20 Feb 2020 -
UK's Cadent Gas to bring rare transition bond
Cadent Gas, the UK gas distribution network spun off by National Grid in 2017, will roadshow from Tuesday next week for a €500m transition bond. The deal is likely to delight green bond specialists who have championed the idea of transition bonds as a way to finance companies that are not green, but are moving towards lower carbon business models.
20 Feb 2020 -
Teréga overwhelmed with orders for slim €400m bond
Teréga, the French gas transport utility, enjoyed chunky demand for a €400m bond issue on Thursday, despite its sub-benchmark size.
20 Feb 2020 -
GlobalCapital Bond Awards 2020: the poll is open
The poll to determine GlobalCapital's Bond Awards 2020 is open. Over the next three weeks, market participants are invited to choose the firms and individuals who have performed most impressively in the past year.
20 Feb 2020 -
India brings steady bond supply to dollar market
International bond volumes from India so far this year have almost doubled from the same period in 2019, showing the strength of the country’s issuers as they continue to emerge from a turbulent period. Debt bankers are optimistic that India is set for a strong 2020, writes Morgan Davis.
20 Feb 2020 -
Vena Energy lights up market with European-bought bonds
Renewable energy company Vena Energy stumped Asian investors with its debut bond sale on Wednesday, relying instead on heavy support from Europe.
20 Feb 2020 -
Greater China issues slew of international bonds
Chinese corporations bombarded investors with new bond options on Wednesday, allowing three issuers to raise $625m between then. Hong Kong-based asset manager ESR Cayman joined the fray in Singapore, grabbing S$225m ($161.55m).
20 Feb 2020 -
Sydney Airport brings sustainable US PP
Sydney Airport has become the first borrower to issue a sustainability-linked US private placement.
19 Feb 2020 -
US companies bring euro high yield back
After a pause last week, the primary high yield bond market in euros has bounced back with two new mandates on Wednesday, unsecured deals for US firms Catalent and Silgan. Both deals are in popular industries and refinance existing debt, with leveraged finance bankers telling clients there’s no time to print like the present.
19 Feb 2020 -
Relx readies up for roadshow
Relx Finance, the funding arm of UK specialist publisher Relx, has hired banks to arrange a roadshow for a triple tranche bond sale, with maturities out as far as 12 years.
19 Feb 2020 -
General Motors follows compatriots into European bonds
US tourists are flocking to Europe's high grade corporate bond market this week with Reverse Yankee deals. General Motors Financial was the latest with a six year trade on Wednesday.
19 Feb 2020 -
Lufthansa flies by Schuldschein market for short dated debt
German airline Lufthansa is looking for at least €150m of Schuldschein debt with a 400 day maturity. The marketing period for the deal is just one week.
18 Feb 2020 -
Sustainability a far cry from the fusty world of US PPs
Several chances to demonstrate commitment to corporate sustainability have occurred in the US private placement market recently, and the market has fallen short in almost every case. Most of the PP market is as unfamiliar with using the term 'ESG' as it is to yelling 'YOLO'.
18 Feb 2020 -
JP Morgan appoints new heads of IB, DCM, ECM, M&A
JP Morgan has promoted a whole new layer of leadership in its investment bank, reaching down to debt capital markets, equity capital markets and M&A. At the top of the tree, Carlos Hernandez has moved from being head of global investment banking to executive chair and has appointed new co-heads of global investment banking.
18 Feb 2020 -
Hiding the impact of IFRS 16 is of no benefit to anyone
Some of the more creative souls in corporate debt markets are trying to find ways to gloss over the impact of the IFRS 16 accounting standard. Brought in a year ago, it has driven up some firms’ leverage ratios by forcing them to report leases on their balance sheets, even though their businesses have not changed. But it would be a bad idea to act as if the rules had never changed.
18 Feb 2020 -
Three Reverse Yankee issuers come to euros at once
US companies piled into the euro bond market on Tuesday, as white goods maker Whirlpool, Dow Chemical and apparel company VF Corp launched medium to long maturity debt.
18 Feb 2020 -
Gazprom guides for first Eurobond for a year
Gazprom has released initial price guidance for a 10 year dollar benchmark at 3.625% area. A US investor said the deal was a “buy”.
18 Feb 2020 -
European Commission opens MiFID II consultation
The European Commission has opened a public consultation on MiFIR/MiFID II, as it takes stock of two years of the sweeping regulations.
17 Feb 2020 -
Britvic raises US PP with 'over £1bn' of appetite
Britvic, the UK soft drinks company that owns brands Robinsons, Tango and Purdey’s among others, has issued £150m-equivalent of US private placements in sterling and euros.
17 Feb 2020 -
ASML heads out for 10 year euros
ASML Holding, the Dutch lithography systems company, visited the euro bond market on Monday, as the bid for corporate credit remains strong, heading towards a March that is expected to be very busy.
17 Feb 2020 -
Sub notes outperform as Welsh Water taps sterling
Dwr Cymru Welsh Water, the UK utility, opened books for a senior and subordinated sterling bond issue on Monday, as the mandates from last week start to trickle through to investors' screens.
17 Feb 2020 -
Drinks group C&C to sell US PPs as Irish firms return
C&C Group, the Irish drinks manufacturer and distributor behind brands like Magners, is set to debut in the US private placement market in the coming weeks, according to market sources.
17 Feb 2020 -
PFZW plans debt-funded swoop on DP World
A Dubai World subsidiary has agreed to buy port operator DP World for $13.9bn. The lending desks at Citigroup and Deutsche Bank will be big winners from the debt-fuelled transaction.
17 Feb 2020
People & Markets
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BoE ‘turbo charges’ post-Libor transition with plans for index and ramped-up haircuts
The Bank of England turned up the heat on Libor this week with plans to publish a compounded Sonia index and averages in a move that will drive the transition to the new risk-free rate with a simpler coupon calculation methodology. It will also increase haircuts on Libor-linked collateral which is intended to accelerate the switch out of Libor FRNs maturing after 2021.
27 Feb 2020 -
World Bank’s Malpass lambasts ECB
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MUFG loses co-head of DCM
SRI
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The end of the road for roadshows
The shock of the Covid-19 coronavirus outbreak has forced some rapid thinking among capital markets participants. Almost the first impact has been travel.
27 Feb 2020 -
Corporate bonds walloped as virus sell-off surprises
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Tech boutique offers tool to spot greenwash
High Yeld
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Plucky levfin forced to yield to mounting alarm about virus
Leveraged finance investors are no shrinking violets, and held out longer than most against the rising pessimism caused by the coronavirus. But by Thursday, it was even giving high yield and leveraged loan players a sinking feeling.
27 Feb 2020 -
Punchy covenants criticised as Fugro presses on for €500m
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Teekay bond resale slows in 'bumpy' high yield market
Private Debt
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Severn Trent to sell PPs after Ofwat decision
Severn Trent, one of the UK’s three listed water companies, is looking to sell US private placements via its holding company, according to market sources. This is the first PP transaction from a UK water company since regulator Ofwat set out a new price review for the sector in December.
24 Feb 2020 -
Water companies re-enter market fray after Ofwat purgatory
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Sydney Airport brings sustainable US PP
Loans
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BoE ‘turbo charges’ post-Libor transition with plans for index and ramped-up haircuts
The Bank of England turned up the heat on Libor this week with plans to publish a compounded Sonia index and averages in a move that will drive the transition to the new risk-free rate with a simpler coupon calculation methodology. It will also increase haircuts on Libor-linked collateral which is intended to accelerate the switch out of Libor FRNs maturing after 2021.
27 Feb 2020 -
Lenders hope Covid-19 doesn't throw off Q2
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Maersk signs sustainable loan amid rating agency virus warnings
Hybrid
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Akelius and British Telecoms have rip-roaring time in hybrid market
Akelius Residential Property, the Swedish property company, and British Telecommunications ratcheted in the yields on their hybrid capital issues by 50bp and 60bp respectively this week, as the market clamoured for yield.
13 Feb 2020 -
AT&T brings preferred hybrids to eager European bond market
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AT&T brings US preferred structure to European hybrid market
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Hybrids have become a savvy corporate treasurer's dream structure
All Corporate Bonds
| Rank | Lead Manager | Amount $bn | No of issues | Share % |
|---|---|---|---|---|
| 1 | JPMorgan | 30.56 | 156 | 8.06% |
| 2 | Citi | 23.91 | 129 | 6.30% |
| 3 | BofA Securities | 23.39 | 121 | 6.17% |
| 4 | Barclays | 21.22 | 100 | 5.60% |
| 5 | Morgan Stanley | 17.52 | 81 | 4.62% |
Bookrunners of European Corporate IG Bonds
| Rank | Lead Manager | Amount $bn | No of issues | Share % |
|---|---|---|---|---|
| 1 | JPMorgan | 4.74 | 19 | 6.82% |
| 2 | HSBC | 4.51 | 23 | 6.48% |
| 3 | Barclays | 3.88 | 17 | 5.58% |
| 4 | Deutsche Bank | 3.76 | 20 | 5.41% |
| 5 | Citi | 3.75 | 16 | 5.40% |
