CORP SNAPSHOT: Bureau Veritas offer post-election litmus test

Guesses in our weekly poll for this week’s euro IG corporate supply ranged from a low of zero to a high of EUR4bn, but given that no issuer went live on Monday ahead of the US election, the former looked like a safer bet.

However, we did say that we could see some issuance attempts on Thursday if there is a clear US Presidential winner by Wednesday, and with Trump sealing a decisive win that is exactly what has happened this morning.

France’s Bureau Veritas is the name that has decided to go live today and steal a march on what is expected to be a busy week for issuance.

Given the issuer's low-beta nature (rated A3 by Moody’s), it is seen by many as the perfect name to re-open the euro corporate market following the election and offer a litmus test of investor sentiment before next week’s potential deluge.

The borrower is touting a 7yr transaction which has been capped at EUR500m no grow, an approach which offers investors clarity from the outset and often helps aid with the execution process.

Bureau Veritas has pulled the trigger after IG corporates (those that weren’t in earnings blackouts) were able to comfortably access the primary market and secure some economic funding last week despite a cocktail of factors which weighed on broader market sentiment.

The headline last week, of course, was the well-flagged jumbo M&A-driven multi-tranche transaction from Danish transport and logistics company DSV A/S which in the end totalled EUR5bn and marked the joint-largest euro corporate trade of 2024.

DSV provided the backbone of a EUR10bn single currency IG corporate week, which not only meant we beat the average EUR8bn estimate but also equalled the highest guess. See a recap of last week’s activity here.

Bureau Veritas offers second euro of 2024

** French certification company French Bureau Veritas SA (A3) mandated BofA Securities and Societe Generale as Global Coordinators, alongside Barclays, Credit Agricole CIB, Commerzbank, NatWest Markets, and UniCredit as Joint Active Bookrunners for an opportunistic EUR500m no grow 7yr trade

IPTs: Books open for EUR500m no grow Nov 2031s at m/s +115 area

• Expected issue rating is A3 by Moody’s
• Proceeds from the 7yr are earmarked for general corporate purposes and refinancing existing indebtedness (which may include some of the existing USPP)
• Bureau Veritas has issued one single currency bond in 2024, a EUR500m 3.5% May 2036 in May at m/s +88 on demand which settled at EUR1.5bn (EUR2.8bn peak)
• Looking at the borrower’s own limited existing euro curve and also the bonds of sector peers, one banker close to the trade was seeing fair value for the new 7yr in the m/s +80-85 region. However, some off the trade thought it was tighter and closer to m/s +75-80

€€€ Bureau Veritas - Pre-Announce Comps €€€

(Bid side vs I-Sprd)

Bond Ratings (M/S/F) Tenor Size (€mm) Spread (MS+)

BVIFP 1 1/8 01/18/27 A3 / NR / NR 2.2Y 500 +52

BVIFP 3 1/2 05/22/36 A3 / NR / NR 11.5Y 500 +105

SUFP 3 09/03/30 NR / A / NR 5.8Y 750 +66

SUFP 3 01/10/31 NR / A / NR 6.2Y 600 +60

SUFP 3 1/4 10/10/35 NR / A / NR 10.9Y 700 +88

SUFP 3 3/8 09/03/36 NR / A / NR 11.8Y 750 +97

LRFP 3 1/2 05/29/29 NR / A- / NR 4.6Y 700 +54

LRFP 3 1/2 06/26/34 NR / A- / NR 9.6Y 600 +89

MLFP 3 1/8 05/16/31 NR / A- / A- 6.5Y 500 +83

MLFP 3 3/8 05/16/36 NR / A- / A- 11.5Y 500 +109

ORAFP 3 5/8 11/16/31 Baa1 / BBB+ / BBB+ 7.0Y 750 +75

ORAFP 3 1/4 01/17/35 Baa1 / BBB+ / BBB+ 10.2Y 600 +94

EXPNLN 1.56 05/16/31 A3 / A- / NR 6.5Y 500 +75

EXPNLN 3 3/8 10/10/34 A3 / A- / NR 9.9Y 650 +108

WKLNA 3 1/4 03/18/29 A3 / BBB+ / NR 4.4Y 600 +56

WKLNA 3 3/4 04/03/31 A3 / BBB+ / NR 6.4Y 700 +79

RELLN 3 3/4 06/12/31 A3 / BBB+ / BBB+ 6.7Y 750 +88

Performance tracker of recent EUR IG/split-rated benchmark deals

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