Germany
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Whitbread, the UK hotel and restaurant company behind Premier Inn, has amended a clause in its debt documentation which could have left it liable for technical default. One source said several companies may have to go through a similar amendment process. -
Public bond investors in Europe received on Monday their first new issue from the car industry since the coronavirus crisis went global. The paper was not from an industrial company but Volkswagen Financial Services, its leasing division, which does not rely on VW producing new cars to repay its debt, but rather on customers who are legally obliged to keep paying their leases. The price was wide, but VWFS showed it had market access.
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BMW has raised €200m from a single investor in the Schuldschein market, according to several market sources. Arrangers are talking with Schuldschein investors to gauge appetite for German auto manufacturers as the Covid-19 pandemic wreaks havoc on corporate earnings.
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Public sector borrowers returned en masse to the primary bond market this week, with many selling new issues with an explicit focus on providing emergency financing in response to the coronavirus outbreak.
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The Schuldschein market’s official lines of bookbuilding have been all but shut during the Covid-19 crisis, but sources have told GlobalCapital that several companies have discreetly approached larger lenders for club or bilateral deals.
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European issuers have got their wish thanks to deals from European Investment Bank at three years and a five year from KfW on Wednesday.
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The primary public sector bond market came back to life on Tuesday as a pair of sovereigns and the European Investment Bank sold deals alongside German states. But it was far from a case of picking up where they left off as borrowers were made to pay new issue premiums of up to 20bp versus the secondary market levels on screens.
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Germany has said it will take the unprecedented step of buying equity stakes in German businesses to protect its economy against the damage caused by the spread of the coronavirus.
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Trading levels given are bid-side spreads versus mid-swaps and/or an underlying benchmark and bid-yields from the close of business on Monday, March 23. The source for secondary trading levels is ICE Data Services.
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The combined capital markets funding of German states in 2020 will substantially rise and could return to the levels seen at the height of the global financial and eurozone sovereign debt crises, according to a global head of debt origination.
