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  • The mayor of London, Ken Livingstone, and Transport for London (TfL) had their request for an urgent hearing of their application for judicial review of the planned London Underground Public Private Partnership (PPP) granted this week in the High Court. The likely date for the hearing is July 23 or 24. TfL and the mayor are arguing that the structure of the PPP will create a £1.5bn funding gap.
  • Despite market grumbles about the tight pricing and lack of financial covenants, the $3.5bn five year revolver for Royal Philips Electronics is progressing well in syndication. "There has been the usual moaning about margins," said one distributor from an arranging bank. "But banks make a lot of money from the name, and anyway, the deal has the comfort of a pricing grid, which is more than what a lot of other relationship deals in the market offer."
  • Mandated arrangers ABC and Citigroup/SSB are due to close syndication of the $50m facility for Union International de Banque today (Friday). The deal, which is due to be signed on July 10, has been oversubscribed by up to $10m. Arab Investment Company has joined the deal for a title of lead arranger for $10m. A group of local and international banks have joined the deal in general syndication. The facility pays a margin of 75bp over Libor (for ticket details see EuroWeek 757).
  • The $500m five year term loan for Bangko Sentral Ng Pilipinas has been heavily oversubscribed.
  • Arrangers ABN Amro and Türkiye is Bankasi (Isbank) last Friday (June 21) signed a $40m five year facility for the Republic of Turkey. Turkey will use the funds to finance the civil works for the construction of the Toprakkale-Iskenderun motorway.
  • The dollar swap market enjoyed considerable volatility this week, especially when it was revealed that WorldCom had cooked its books to the tune of $3.9bn. As equities crashed and the Treasury market scorched to much lower yields, dollar swap spreads tightened sharply. However, by the end of trading yesterday (Thursday), the swap market appeared to have shrugged off the WorldCom effect.
  • The devastating blow dealt by WorldCom this week shattered already fragile investor confidence and caused massive dislocation in spreads across all debt markets, bringing to a close one of the most volatile quarters in recent history. Telco spreads were worst affected, but bank and insurance company debt was also severely hit. Earlier in the week France Télécom's two notch downgrade to the brink of junk status had sent telecoms spreads spiralling downwards, with FT's bonds widening by around 100bp.
  • European banks' loan exposure to WorldCom is fairly low, according to analysts, who say that bondholders are far worse off. Bear Stearns released statistics this week showing that WorldCom had outstanding bond debt totalling $30.2bn, compared with total loans of $8bn - of which only $2.65bn has been drawn down.
  • Rating: A- Amount: Eu100m (increase to Eu400bn issue launched 14/06/02)
  • WorldCom’s $3.8bn accounting scandal caused widespread chaos in the US this week as spooked investors ran for cover.
  • The devastating blow dealt by WorldCom this week shattered already fragile investor confidence and caused massive dislocation in spreads across all debt markets, bringing to a close one of the most volatile quarters in recent history. Telco spreads were worst affected, but bank and insurance company debt was also severely hit. Earlier in the week France Télécom's two notch downgrade to the brink of junk status had sent telecoms spreads spiralling downwards, with FT's bonds widening by around 100bp.
  • WorldCom’s $3.8bn accounting scandal caused widespread chaos in the US this week as spooked investors ran for cover.