By Ben Edwards
U.S. cigarette maker Philip Morris International Inc. (PM) and
Spanish telecommunications operator Telefonica SA (TEF) were among
a string of companies raising cash in the European primary bond
market Thursday, crowning a bumper week for euro bond sales.
Companies selling bonds in euros have already raised 7 billion
euros ($9.1 billion) this week, with Thursday's batch of deals
likely to push that tally above EUR10 billion--the highest level of
weekly euro corporate issuance so far this year, according to
Dealogic.
Telefonica's eight-year offering is the company's second euro
bond sale this year, though it is the first senior deal from a
Spanish corporate borrower since late January. It comes on the same
day the Spanish Treasury sold EUR803 million of long-dated debt at
a special auction, so called because it was held outside its
regular issuance schedule.
Credit risk eased Thursday, with the cost of insuring European
corporate debt falling, potentially ending the day lower for the
first time this week, according to data provider Markit.
Here's a run down of how the credit default swap market is
performing, who's selling bonds and what's coming up:
CDS:
iTraxx Europe index: 2 basis points tighter at 104/105 bps
iTraxx Crossover index: 7 bps tighter at 402/404 bps
NEW ISSUES:
Philip Morris, the maker of Marlboro cigarettes, is planning a
two-part, euro-denominated bond sale. The EUR1.25 billion,
seven-year tranche will price at 55 basis points over midswaps. The
EUR750 million 12-year tranche will price at 83 basis points over
midswaps.
Telefonica is planning an eight-year euro deal, with price
guidance in the area of 260 basis points over midswaps--30 basis
points more than it paid for 10-year money in early January.
Unrated German construction services company Hochtief AG
(HOT.XE) is seeking to sell a benchmark-size, seven-year euro deal.
Suggested pricing was for the bond to yield in the area of
4.25%.
Dutch publishing and information group Wolters Kluwer NV
(WKL.AE) is planning a 10-year euro benchmark bond. Suggested
pricing was in the area of 125 basis points over midswaps.
Polish energy group Energa SA is planning a EUR500 million,
seven-year bond. Suggested pricing was in the area of 220 basis
points over midswaps.
COMING UP:
Arcelik AS (ARCLK.IS), Turkey's largest domestic appliance
manufacturer, is planning to meet investors ahead of a potential
debut dollar bond. Meetings will take place in Europe and the U.S.
from March 18.
--Sarka Halas contributed to this article
Write to Ben Edwards at ben.edwards@dowjones.com