Europe

Alcentra has provided $530m of senior debt to fund the acquisition of medical device maker Lumenis by Baring Private Equity Asia, in the largest direct lending deal the European private debt specialist has done in its history.

Companies with weak balance sheets will find it difficult to raise equity capital in the weeks ahead after oil prices plunged 30% overnight, tipping global stockmarkets into bear market territory. The difficulty is likely to be particularly acute for companies in sectors heavily exposed to the spread of the Covid-19 virus, such as energy, travel and tourism.

The yields on 10 year Italian and Greek government bonds rose by 30bp-40bp on Monday from Friday’s close after Italy placed a quarter of its population under quarantine over the weekend as the Covid-19 virus escalates.

UK electricity distributor Electricity North West, which manages electricity networks in the north west of England, has started marketing US private placements. However sources are worried the market will not cope with pricing transactions amid wild swings in Treasury yields.

Covered bond spreads jumped wider on Monday in response to even sharper moves in the credit market. The selling was modest in volume and, with market makers protecting their bids, trades were done far wider than indicative levels.

The European Central Bank has lifted the limits on exposure to Greek government paper that it imposed on the biggest Greek banks following the eurozone sovereign debt crisis, GlobalCapital understands.

Volatility in the financial institutions bond market drove spreads even wider on Monday as a crash in the price of oil added to fears over the extent of the coronavirus outbreak. It was enough to close the primary bond market for the foreseeable future, said market participants.

European equities plunged into bear market territory on Monday morning after the price of oil collapsed by 30% following the decision by Saudi Arabia to launch a price war after OPEC and Russia failed to reach a deal on production cuts at the weekend.

Danish pharmaceuticals company Bavarian Nordic has announced an Nkr2.8bn (€378m) rights issue to fund its acquisition of GlaxoSmithKline’s commercial and manufacturing rights to Rabipur, a treatment for rabies, and Encepur, a vaccine against tick-borne encephalitis.

Shares in Norwegian Air Shuttle, the Norwegian airline, fell more than 25% on Friday morning after the company scrapped its profit guidance for 2020 because of the mounting economic damage caused by the spread of the Covid-19 coronavirus.

This week's funding scorecard looks at the progress of Europe's supranationals and agencies at the start of March.

Vattenfall, the Swedish state power company, issued its second green bond on Thursday, to an enthusiastic reception from investors, who drove the €500m note’s pricing very close to the issuer’s curve.