Germany starts bookbuilding for first linker
Nov 9, 2006, 17:44
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Germany on Monday started bookbuilding for its first inflation-linked bond issue, which will be completed by Tuesday. The country aims to issue ˆ5.5bn of bonds with interest payment linked to the rate of inflation in the eurozone. The bond will pay a premium of between 3 and 7 basis points above yield on the French inflation-linked bond, or 205-209bp more than 2016 nominal fixed-rate Bund. Investors had already placed orders worth about ˆ5bn yesterday and the order book would close today, said a person close to the transaction. The bond would be priced and launched by tomorrow, the person said. ABN Amro, Barclays Capital, BNP Paribas and Deutsche Bank are managing the sale. British American Tobacco, the world’s second-largest cigarette maker, plans to sell about ˆ1bn of bonds in euros and sterling. The maker of Lucky Strike cigarettes is returning to the market after postponing a sterling issue last December amid market uncertainty ahead of a legal ruling in the US on Philip Morris, which makes Marlboro cigarettes, about selling light cigarettes. The ruling went in the tobacco maker’s favour. The deal from BAT is expected to include a ˆ500m issue with a maturity of September 2014 and a ?300m deal that matures in September 2016, according to people close to the transaction. Barclays Capital, Deutsche Bank, HSBC and RBS are lead-managing the sale.
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