Both Waterford Wedgewood and Independent News & Media have issued corporate bonds in an effort to reduce their debt.
Waterford Wedgewood, the luxury goods group, raised €166 million in a seven year subordinated bond issue, which priced at a coupon of 97/8 per cent.
The bond issue at 99.381pc was oversubscribed, and the deal was arranged by Barclays Capital.
It is expected that Waterford Wedgewood will use the funds raise to pay down its net debt, which as of September 2003, stood at €429.9 million.
As well as issuing the bond, Waterford Wedgwood has also established a new senior debt structure, which reduces the revolving credit facility from €338.4 million to €224.0 million, reduces the amended US private placement notes from US$95 million (€81.2 million) to US$62.9 million (€53.8 million), and partially repays other senior debt facilities. Waterford Wedgewood have also launched a rights issue, which it intends will raise €38.5 million of new equity.
Chief executive Redmond O’Donoghue told Finance that the bond offering, together with the rights issue, add to the group’s liquidity, extend the maturity of its indebtedness and further solidify its long-term capital structure.
Independent News & Media (IN&M), the media group, has also launched a €124 million five year subordinated bond. The bonds have an 8 per cent coupon and were issued at a par to yield 8 per cent.
Davy Stockbrokers acted as sole lead manager for the transaction, with NCB Stockbrokers the co-manager on the deal.
Like in Waterford Wedgewood’s case, the funds raised will be used to reduce corporate debt.
According to Barry Nangle, head of bonds at Davy Stockbrokers, demand for the bond was strong with 32 investors from seven countries across Europe participating in the deal, with UK, German and French institutions accounting for two thirds of the interest.
The last time IN&M issued a bond was back in May 1999 when it launched a €200 million 10-year deal, which has a coupon of 5.75 per cent.
Two other notable bond deals in 2003 were eircom’s €1.085 billion bond and Ardagh’s €175 million issue. |
