Europe

Fallen angels — corporate borrowers that lose their investment grade ratings — have become a key source of supply in global high yield bonds markets over the years. But there are signs that, particularly in Europe, such supply is ebbing away as corporate balance sheets improve. This is driving HY investors elsewhere to seek new credits.

ADO Properties made its debut in the corporate bond market on Thursday, following a roadshow earlier in the week. The €400m seven year deal provided further supply for investors keen to buy higher yielding triple-B rated credits, but the supply is drying up in the summer heat faster than the demand.

Germany is headed for a clash with other EU member states, as it pushes to ease banking regulations for small institutions – a move obviously intended to favour its co-operative and savings banks.

After selling $150m of green residential mortgage-backed covered bonds to the International Financial Corporation, Garanti Bank expects to sell another deal to the European Bank for Reconstruction and Development.

US cleaning products maker Diversey has accelerated commitments on its €1.6bn-equivalent of loans, backing Bain Capital’s $3.2bn carve-out of the business from Sealed Air, despite one investor in London expressing concern over the deal’s leverage.

The bank wants to grow its franchise, but may have to take its M&A joint venture with Case a step further to achieve its goals, writes David Rothnie.

Panda bonds are finally coming back to life after a dire first half. But although all the conditions are in place for an issuance boom, there is reason to doubt quite how high volumes will go.

Supermarket Income Reit has completed a £100m IPO on the London Stock Exchange on Wednesday, though it raised less money than it had hoped. The promoters believe they are offering access to an undervalued part of the UK property market that can provide a strong yield.

Power derivatives activity in the first half of 2017 at the European Energy Exchange (EEX) declined as a result of uncertainty created by the split of the German-Austrian price zone.

Ivanhoé Cambridge, the Canadian real estate company that is the largest shareholder in Gecina, has sold 87% of its allocation of rights in the French property group's €1bn rights issue, through a block trade on Tuesday night.

Italian electricity network operator, Terna, brought its first new issue of 2017 on Wednesday, and benefitted from the current strong demand for triple-B rated bonds. The €1bn 10-year deal had an orderbook of €1.6bn and printed with a new issue premium of 10bp.

Vodafone was the star issuer of last summer, printing jumbo deals which served to kick-start the sterling corporate bond market, which is still going strong. On Wednesday however, they opted for more conservative volumes, printing before the summer shutdown begins. The UK telecoms company also adopted a novel approach to pricing.