LONDON- Anglo American plc opened books on Tuesday for a seven-year euro benchmark deal, hoping to make the most of marginally tighter credit spreads and lasting investor appetite for corporate paper ahead of the next bout of volatility.
Shortly before 0815GMT, the Baa1/BBB+ rated British-based multinational mining company named Goldman Sachs, HSBC, RBS and Santander as leads, who began testing investor interest in the area of 130bp over mid-swaps.
Anglo American was last in the euro market in March this year when it issued a EUR750m 10-year via Credit Agricole CIB, Commerzbank, Lloyds and RBS.
That deal was driven by the attractive euro/US dollar basis swap rate which saved the company an estimated 10-15bp compared to a direct dollar funding exercise.
The March 2022 bond priced at mid-swaps plus 112bp on the back of a book of EUR3.4bn from around 245 accounts.
“The deal in March went very smoothly and based on that, and the still relatively attractive basis swap rate, we decided that accessing the euro market again would be sensible,” a syndicate banker involved in the latest deal said.
By Tuesday, the March offering was trading at 143bp over mid-swaps according to Tradeweb, having widened by around 5.5bp on the announcement of the latest deal.
Anglo American also has outstanding euro issues maturing in September 2013, April 2015, December 2016 and May 2018, which according to bankers away from the deal suggest fair value of around 110bp over mid-swaps, for a new issue premium of around 20bp.
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Keep Reading
Leads, however, cite fair value a touch tighter at around 106bp over, indicating a larger concession of closer to 24bp. They added, though, that guidance would likely be tightened.
