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Tuesday, 28 March 2017

Beetle juice

IFR 2176 25 March to 31 March 2017

Business as usual is not a mantra that Volkswagen has been able to trot out over the past 18 months.

Top News

Volkswagen logo

VW wows with blockbuster comeback

IFR 2176 25 March to 31 March 2017 By , Robert Hogg

Volkswagen left nothing to chance on its first euro unsecured bond since the emissions cheating scandal, with the issuer printing a blockbuster trade that silenced any concern about its access to the capital markets.

Glencore logo

Glencore tanks and scuppers Anglo's return

IFR 2176 25 March to 31 March 2017 By

Anglo-Swiss miner Glencore sold its first US dollar bond in two years last Tuesday, but the deal tumbled after pricing as a global sell-off added to a backlash against the deal’s tight spread.

Poland

Dino's off and running

IFR 2176 25 March to 31 March 2017 By ,

A brace of IPOs means Poland is back on equity investors’ radars for the first time in years, and the quick coverage for supermarket group Dino Polska’s float shows institutions are keen to buy.

Bucket with the colours of Argentina's national flag

Argentina's Swiss return comes at a price

IFR 2176 25 March to 31 March 2017 By

Argentina returned to the Swiss franc market last Thursday after an absence of nearly two decades, although the sovereign’s lowly ratings and chequered history meant the deal was an acquired taste for investors.

CFTC logo

SEFs gear up for brave new world

IFR 2176 25 March to 31 March 2017 By

Swap execution facilities are facing a new regime that some believe could make or break the platforms after acting CFTC chairman Christopher Giancarlo vowed to fix flawed swaps rules and allow market participants to choose the manner of execution best suited to their swaps trading.

Sears department store at Fair Oaks Mall in Fairfax

Troubled US retail space spells bondholder pain

IFR 2176 25 March to 31 March 2017 By ,

Investors are shunning the bonds of US retailers, even though much of the paper from the troubled sector is available at bargain-basement prices.

US dollar bills

Investors park cash in jumbo SPAC

IFR 2176 25 March to 31 March 2017 By

Silver Run Acquisition II, a special purpose acquisition company sponsored by Riverstone Group and headed by former Anadarko Petroleum CEO James Hackett, had a hard time turning investors away on its US$900m IPO. An initial target of US$400m for the energy-focused SPAC increased to US$550m before settling at US$900m. Exercise of the greenshoe, a likely outcome, would make it the largest-ever US SPAC float.

A giant panda

Rusal makes Panda statement

IFR 2176 25 March to 31 March 2017 By Ina Zhou

Highly leveraged aluminium producer United Company Rusal won over sceptical Chinese investors to complete Russia’s first Panda bond almost seven years after it first attempted to raise funds in renminbi.

The entrance of Portuguese bank headquarters Caixa Geral de Depositos is seen in Lisbon

CGD AT1 tempts investors

IFR 2176 25 March to 31 March 2017 By

Caixa Geral de Depositos cajoled investors into buying €500m of its most deeply subordinated debt, a key element in the state-owned bank’s recap plan, but the 10.75% coupon is the highest since the market’s infancy in 2013.

People stand outside the headquarters of China Oil and Foodstuffs Corporation (COFCO) in Beijing, China, November 3, 2016.

M&A scrutiny dents China loans

IFR 2176 25 March to 31 March 2017 By Carol Zhong

Chinese companies have completed only US$1.1bn of merger-and-acquisition loans so far this year, as government efforts to curb capital outflows and “irrational” overseas takeovers have taken a toll on event-driven lending, Thomson Reuters LPC data show.

IFR Magazine Top News in Full (subscription required)

People & Markets

Credit Suisse considers capital raise

IFR 2176 25 March to 31 March 2017

Credit Suisse kept shareholders guessing last week on whether it plans to launch a capital raising rather than float its domestic bank. The bank has said it needs to raise at least SFr2bn (US$2.02bn) this year.

Buoyant Q1 for Jefferies lifts expectations

IFR 2176 25 March to 31 March 2017

Jefferies Group rebounded from a big loss last year to report buoyant revenues in its latest quarter across fixed income trading, equity trading, debt and equity underwriting and merger advisory.

Who's moving where

IFR 2176 25 March to 31 March 2017

Bank of America Merrill Lynch has hired Eric Bischof from Morgan Stanley to co-head its global financial institutions group. Bischof will be based in New York and report to Diego De Giorgi, head of investment banking. He will be co-head alongside Jim O’Neil. Bischof has spent the last 20 years at Morgan Stanley, most recently as co-head of global FIG. He has specialised in insurance and worked on deals for AIG, ACE Group, Fortress Investment Group and Endurance Specialty Holdings

Deutsche softens bonus blow with €1.1bn 'retention award'

IFR 2176 25 March to 31 March 2017

Deutsche Bank has awarded deferred cash and shares worth up to €1.1bn across more than 5,500 staff in a special “retention award”, to soften the blow of a 77% plunge in the bank’s bonus pool last year.

From the practice of placing a bell around the neck of a castrated ram to lead the flock

Gnodding off

IFR 2176 25 March to 31 March 2017

GOLDMAN SACHS’S EUROPEAN CEO, Richard Gnodde, grabbed the headlines last week by declaring the US bank was planning to hire or relocate “hundreds” of staff in its European operations outside London as part of its contingency planning for Brexit.

    More from People & Markets

    Bonds

    InBev targets US$3.1bn exchange

    IFR 2176 25 March to 31 March 2017

    AB InBev has opened an exchange offer on 10 of its US dollar notes for a combination of new 2048 notes and cash, according to a statement from the company.

    European politics trump Asian demand

    IFR 2176 25 March to 31 March 2017

    Japanese investors, who were big net buyers of French sovereign bonds for most of 2016, have been reducing their positions since November, contributing to a dip in Asian allocations on recent SSA offerings.

    KCA Deutag forced to change structure, hike yield

    IFR 2176 25 March to 31 March 2017

    Oil services company KCA Deutag was forced to change the structure and hike the yield of its struggling junk bond offering to get the deal over the line on Tuesday.

    Spreads reach widest of year

    IFR 2176 25 March to 31 March 2017

    US junk-bond spreads gapped out to their widest levels of the year last Wednesday, moving in the opposite direction of their high-grade counterparts as investors show some jitters about the asset class.

    RSA launches tender on two securities

    IFR 2176 25 March to 31 March 2017

    RSA Insurance Group has invited bondholders to tender for purchase for cash a £500m note due 2039 and a £375m perpetual note, to optimise its capital structure.

      More from Bonds

      Loans

      Australia: BoC steps up for Alinta purchase

      IFR 2176 25 March to 31 March 2017 By Sharon Klyne

      Bank of China is financing most of the A$4bn (US$3bn) acquisition of Australian gas and electricity retailer Alinta Energy by Hong Kong’s Chow Tai Fook Enterprises.

      Netherlands: Basic-Fit ups RCF to €175m

      IFR 2176 25 March to 31 March 2017

      Dutch fitness club operator Basic-Fit has increased its revolving credit facility to €175m from €100m to help fund increased investments for its accelerated growth plan.

      Metinvest finalises restructuring

      IFR 2176 25 March to 31 March 2017

      Ukrainian metals and mining group Metinvest has completed the restructuring of its US$2.3bn debt.

      Hunkemoller seeks divi recap

      IFR 2176 25 March to 31 March 2017

      Dutch lingerie firm Hunkemoller has launched a €430m dividend recap.

      Audiotonix allocates TLB

      IFR 2176 25 March to 31 March 2017

      UK audio mixing console manufacturer Audiotonix has allocated its £142m-equivalent term loan B backing its buyout by Astorg after tightening pricing during syndication.

      Pfleiderer seeks €450m refi

      IFR 2176 25 March to 31 March 2017

      Polish wood materials company Pfleiderer Group has launched a €450m refinancing.

      Financing for Ardian’s Prosol buy

      IFR 2176 25 March to 31 March 2017

      BNP Paribas, Credit Agricole and Natixis have provided leveraged loan financing to back Ardian’s acquisition of a majority stake in Prosol, founder of fresh food retailer Grand Frais.

      Independent Vetcare raises £182m

      IFR 2176 25 March to 31 March 2017

      UK veterinary care business Independent Vetcare is raising an extra £182m-equivalent of leveraged loans to back its merger with Northern European peer Evidensia.

      More from Loans

      Equities

      India: Avenue's debut strongest in a decade

      IFR 2176 25 March to 31 March 2017

      Shares of Avenue Supermarts rose 115% last Tuesday in the strongest debut for an Indian IPO in a decade.

      China: CSRC approves 10 IPOs

      IFR 2176 25 March to 31 March 2017

      The China Securities Regulatory Commission has approved the listing applications of 10 companies, intending to raise a combined Rmb5.1bn (US$739m).

      China: Anta Sports completes top-up

      IFR 2176 25 March to 31 March 2017

      Anta Sports Products has raised HK$3.79bn (US$488m) through a top-up placement of 175m shares, priced at the bottom of an indicative range of HK$21.67-$22.13, or at a discount of close to 8% to the pre-deal spot.

      China: Dianchi Water Treatment launches IPO

      IFR 2176 25 March to 31 March 2017

      Kunming Dianchi Water Treatment started bookbuilding last Friday for a Hong Kong IPO of up to HK$1.59bn (US$206m).

      China: Haitong plans financial leasing float

      IFR 2176 25 March to 31 March 2017

      Haitong Securities is considering listing its financial leasing unit in Hong Kong, according to people familiar with the situation.

      China: ZhongAn Online revives HK IPO

      IFR 2176 25 March to 31 March 2017

      ZhongAn Online Property and Casualty Insurance has resumed work on its Hong Kong IPO, according to people familiar with the situation.

      Australia: Citi sells Evolution Mining block

      IFR 2176 25 March to 31 March 2017

      Citigroup has sold a A$174.8m (US$134m) block of shares in Australia’s Evolution Mining, according to a source close to the deal.

      Australia: PNG lender set for A$300m listing

      IFR 2176 25 March to 31 March 2017

      Papua New Guinea’s Bank of South Pacific is pressing ahead with a secondary listing in Australia that could raise up to A$300m (US$231m), according to a source close to the deal.

      More from Equities

      Derivatives

      CFTC logo

      SEFs gear up for brave new world

      IFR 2176 25 March to 31 March 2017 By

      Swap execution facilities are facing a new regime that some believe could make or break the platforms after acting CFTC chairman Christopher Giancarlo vowed to fix flawed swaps rules and allow market participants to choose the manner of execution best suited to their swaps trading.

      Hong Kong launches first RMB options

      IFR 2176 25 March to 31 March 2017

      Hong Kong Exchanges and Clearing last week launched its first currency options, rolling out more renminbi-related derivative products in a bid to cement Hong Kong’s status as the main offshore renminbi trading hub.

      LCH kick-starts client CDS clearing with Amundi

      IFR 2176 25 March to 31 March 2017 By

      Amundi has become the first European buyside client to begin clearing credit default swaps through CDSClear, LCH’s Paris-based clearinghouse.

      EuroStoxx logo

      VStoxx shrugs off election risk

      IFR 2176 25 March to 31 March 2017 By

      Europe’s VStoxx volatility index continued to trade at a historically tight spread over the US VIX last week, shrugging off French election risk even as global volatility measures jumped off record lows.

      Sign outside Neiman Marcus Last Call store

      Neiman Marcus bondholders left guessing

      IFR 2175 18 March to 24 March 2017 By

      Troubled retailer Neiman Marcus is considering an outright sale of the company, but that would be likely to prove extremely costly unless bond or equity holders take steep losses.

      More from IFR Derivatives

      UPDATE 3-US companies put freeze on new bond deals

      27 March 2017 By

      US companies slammed the brakes Monday on new bond issuance, taking a pause in the busiest quarter ever to digest the fallout from the healthcare vote and its implications for tax reform.

      Loxam logo

      Loxam out with M&A bond financing

      27 March 2017 By Robert Smith

      Loxam started marketing a €810m trade on Monday as it seeks to take out the bridge financing for the acquisition of UK peer Lavendon.

      European corporate issuance boom continues unabated

      27 March 2017 By

      Corporate borrowers left no time for the dust to settle from last week’s European issuance bonanza, with five more tapping investors for new funding on Monday.

      European Union flags

      EU taps into duration bid to help Ukraine

      27 March 2017 By Matt Painvin

      The European Union has tapped its 0.75% April 2031 issue for €600m on the back of the flattening of the long end of the curve, underlining the appetite for duration in the common currency.

      The Bank of England is seen in the City of London

      UK toughens stress tests with sterling drop, wider bond spreads

      27 March 2017 By Steve Slater

      Global GDP will fall by 2.4%, sterling plunges against the dollar, UK interest rates rise to 4% and US corporate bond spreads will widen by 1,150bp under the 2017 “stress test” scenario for Britain’s big banks.

      South Africa

      South Africa non-deal roadshow causes waves

      27 March 2017 By Robert Hogg

      Political risk in South Africa has been thrust back on to the agenda, with the country’s non-deal roadshow acting as the unexpected trigger for an outbreak of headlines.

      China Molybdenum logo

      Molybdenum seals US$700m loan for more Tenke mine stake

      27 March 2017

      China Molybdenum has signed a US$700m seven-year amortising term loan to fund its purchase of an additional 24% stake in Africa’s Tenke copper mine.

      SMBC backs MBK's Tasaki MBO

      27 March 2017

      Private equity fund MBK Partners is raising a ¥24bn (US$218m) seven-year term loan for its planned ¥31.5bn management buyout of Japan pearl retailer Tasaki, according to a filing to the Tokyo Stock Exchange..

      MOVES-Senior debt bankers to leave BAML

      27 March 2017 By Alex Chambers,

      Three senior debt capital markets bankers at Bank of America Merrill Lynch are expected to leave the US bank in the coming weeks, according to multiple sources.

      Anthony Peters columnist format

      Rome wasn't built in a day

      27 March 2017 By

      After President Trump’s rather ignominious defeat at the hands of his own intransigence and self-belief, as observers, we must guard ourselves from laughing too loudly.

      MOVES-MUFG names L'Heureux for EMEA leveraged finance role

      27 March 2017

      Mitsubishi UFJ Financial Group has appointed Louis L’Heureux as head of financial sponsors for leveraged finance in Europe, Middle East and Africa.

      Galenica Sante IPO already in good health

      27 March 2017 By

      Galenica Sante has already covered its SFr1.1625bn–SFr1.4625bn (US$1.18bn–$b1.48n) IPO on the SIX Swiss Exchange, just a few hours into bookbuilding.

      MOVES-UniCredit names Corsini as transaction banking co-head

      24 March 2017

      UniCredit said Luca Corsini will become co-head of global transaction banking from August alongside Jan Kupfer.

      MOVES-Meyers rejoins JP Morgan to head ECM for sub-Sahara Africa

      24 March 2017 By Steve Slater

      JP Morgan has rehired Barry Meyers from Barclays to head its equity capital markets business for sub-Saharan Africa.

      Abbott offloads Mylan stake via US$1.7bn overnight block

      23 March 2017 By

      Abbott Laboratories has sold more than 60% of its remaining stake in EpiPen maker Mylan in a US$1.7bn unregistered block trade via Morgan Stanley, one of the largest-ever commitments in this format.

      Companies tap bonds to make pension contributions: BAML

      23 March 2017 By

      Companies have been increasingly issuing high-grade bonds to make contributions to pension plans. But any new supply will be offset by increased demand from private defined benefit plans rotating out of equities into fixed-income, said Bank of America Merrill Lynch in a report released on Thursday.

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      Special Reports

      IFR Review of the Year 2016
      It’s normally fair to say that bankers grumbling about the state of the markets deserve the same sympathy as farmers moaning about the weather. It goes with the territory. And it is up to them to simply get on with it.

      IFR Americas Review of the Year 2016
      Markets are more agnostic about elections than the public at large. Even as half (or more) of America was gnashing its teeth over the election of the country’s first non-politician president since Eisenhower, the “Trump Rally” was in full flight.

      IFR German Corporate Funding Roundtable 2016
      IFR convened its fifth annual German Corporate Funding Roundtable in Frankfurt in mid-November just as bond markets, led by US Treasuries, were starting their sharp re-pricing off the back of higher inflation expectations and tighter US money.

      IFR India's Path to Sustainable Growth Roundtable 2016
      IFR recently convened a highly insightful roundtable discussion in Washington DC, entitled “India’s Path to Sustainable Growth: Challenges and Opportunities”. State Bank of India chair Arundhati Bhattacharya delivered some affirmative opening comments that eloquently framed the discussion that followed./p>

      From the practice of placing a bell around the neck of a castrated ram to lead the flock

      Gnodding off

      IFR 2176 25 March to 31 March 2017

      GOLDMAN SACHS’S EUROPEAN CEO, Richard Gnodde, grabbed the headlines last week by declaring the US bank was planning to hire or relocate “hundreds” of staff in its European operations outside London as part of its contingency planning for Brexit.