Italy
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Is this bond expensive or are BTPs cheap? That was the question investors considering Wednesday’s debut corporate bond issue from Italian supermarket chain Esselunga had to answer. But there was more to come as an Italian high yield borrower also raised funds at sub-2% writes Nigel Owen. -
This week, Esselunga, a 60 year old Italian supermarket chain issued its debut corporate bonds. It is rated Baa2/BBB-, the same as its own government.
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Salini Impregilo, the Italian construction firm, printed new bonds with a coupon under 2% on Thursday, becoming only the third high yield borrower to duck under the hurdle this year.
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On Wednesday, Italian supermarket chain, Esselunga, became the first non-utility issuer to sell a benchmark corporate bond since Iliad’s €650m deal on October 5. The company’s debut deal saw one tranche priced at a lower yield than Italian government bonds.
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Italian telecoms firm Wind called on the high yield market on Wednesday, as it planned to refinance most of its debt with a dual currency five tranche offering, deploying 20 bookrunners in the process.
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All four investment grade benchmark corporate bond deals that priced last week were from utilities. On Tuesday, Italian multi-services utility, Iren, and Dutch grid operator, Stedin, took the count to six.
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Finnish property company, Mercada, was a lone issuer in the corporate bond market on Monday. Its €175m five year deal q was printed while issuers that completed roadshows last week paused.
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In a busy week for utility company bonds Iren, the Italian electricity and gas distributor, on Tuesday announced a new benchmark green bond alongside a tender offer for some of its outstanding bonds.
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On Wednesday, A2A became the second Italian utility this week to sell a 10 year new issue. The company achieved the current benchmark low single digit new issue premium for its €300m deal.
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Italy’s banks and politicians are worried about the European Central Bank’s non-performing loan crackdown. They are right to worry — but the answer is bankruptcy reform.
