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NORWEGIAN oil exploration company Ocean Rig Norway became the first issuer from the energy sector to tap Europe's rapidly developing high yield market this week with a two tranche transaction totalling $350m. The deal comes just weeks before a planned $200m offering by Canadian oil exploration company, State Energy Corp, which is scheduled for launch in June. Ocean Rig's Euro/144A issue comprises a $125m floating rate note paying a coupon of 475bp over Libor and a $225m fixed rate transaction launched at a spread of 460bp over US Treasuries.

* Volkswagen Financial Services NV Guarantor: Volkswagen Financial Services AG

Finland Merita and Postipankki have closed general syndication of the DM200m seven year multicurrency revolving credit for Soumen Osuuskauppojen. The loan has been oversubscribed and the borrower is considering an increase. Banks were offered three levels of participation -- senior lead managers taking DM40m for a fee of 10bp, lead managers DM20m for a fee of 7.5bp and managers DM10m for a fee of 5bp.

THE RUSSIAN Federation is to increase its Eurobond funding this year to replace more costly domestic bond issuance. Under the provisions of the 1998 budget, Russia is to raise more than $5.5bn in the international bond markets, versus a previously declared target of $3.5bn. This year the Russian Federation has raised the equivalent of $1.1bn via a DM1.25bn seven year issue and Lit750bn five year offerings. The sovereign's next issue may be in dollars, with Deutsche Morgan Grenfell and Goldman Sachs to act as joint lead managers. Benchmark issues in yen and euros are also expected.

Guy Hands, managing director of Nomura's Principal Finance Group, has made himself, his colleagues and his firm a fortune by using securitisation techniques to finance LBOs. Can others do the same?

THE PIPELINE of Euro-convertibles from continental and US issuers continues to grow with issuers lining up for the third and fourth quarters of 1998. However, for the next two months, convertible issuance will be eclipsed by the vast array of primary and secondary straight equity. Among the noteworthy deals in the market is the $540m offering of Lyons (Liquid Yield Option Notes) for SGS Thomson, the Franco-Italian micro-electronics group. The offering coincides with the sale of straight equity in the group which involves a capital increase and a secondary sale by the two respective government shareholders.

GLOBAL co-ordinators Merrill Lynch and Merita are preparing to launch the sale of stock in Sonera, the renamed Finland Telecom, and are due to hold beauty contests for the appointment of a selling syndicate in the next few days. The timing of the offering will largely depend on the authorities' decision concerning the sale of shares in the merged oil, gas and electricity entity, IVO Neste.

* World Bank Rating: Aaa/AAA

* Landwirtschaftliche Rentenbank Rating: Aaa/AAA

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* Abbey National Treasury Services Guarantor: Abbey National plc

* Province of British Columbia Rating: Aa2/AA