CORP SNAPSHOT: Heimstaden Bostad to launch hybrid ahead of upcoming call date
IG corporate activity was expected to slow this week following a two-week EUR28.8bn/42 tranche flurry, and so it is perhaps no surprise to see issuers staying away on Monday.
Feedback from bankers received at the back end of last week suggested that there are only a few known potential projects to be launched before attention instead turns to 2025 and what is expected to be a typically frenetic January.
With that, the average euro corporate (ex-HY) supply estimate put forward by participants in our latest issuance poll came in at just EUR4bn.
One borrower which is set to account for some of that is Heimstaden Bostad AB (BBB-/BBB-), a Swedish residential real estate company.
The borrower this morning hired BNP PARIBAS, Citi, Deutsche Bank, JP Morgan and Nordea as Joint Bookrunners to arrange a series of fixed income investor calls Monday ahead of a EUR500m no grow PNC5.25 hybrid line with an expected rating of BB by S&P and BB by Fitch.
Concurrently to the mandate announcement, Heimstaden has today launched a tender offer on its EUR800m 3.248% perpetual hybrid securities with a first reset on 19-Feb-2025 (ISIN XS2010037765).
The new deal will mark the company’s first hybrid since Oct 2021 when it issued a EUR600m 3.625% non-call Jan 2027 bond at a yield of 3.75% on a EUR850m book.
Monday’s blank comes after issuers were out in force again this week where we saw 11 issuers in euros with a mixture of vanilla, green and hybrid trades making the most of the appealing late-2024 issuance window.
They priced a combined 17 tranches which totalled EUR10.85bn, to follow the third biggest week of the year the previous week which saw an even bigger EUR17.95bn (25 lines) cross the tape. Showing that demand is still strong, the average cover ratio across this week’s trades finished up at 3.22x, marginally down from the previous week’s 3.42x figure.
However, given the delicate backdrop and with issuers ramping in pricing significantly during the execution process, some more orderbook attrition was recorded. Full recap below:
Summary of last week's EUR IG corporate trades
| Date | Issuer | Size (EUR m) | Maturity | IPTs | Re-offer | IPT to Re-offer Pricing Differential (bp) | NIC (bp) | Books (EUR m) | Final Cover Ratio (X) | Peak Books (EUR m) |
| 18-Nov | National Grid North America Inc | 600 | 25-Nov-29 | m/s+135a | m/s+100 | -35 | 0 | 1600 | 2.67 | 2400 |
| 18-Nov | National Grid North America Inc | 600 | 25-Nov-34 | m/s+175a | m/s+140 | -35 | 0 | 1100 | 1.83 | 2000 |
| 18-Nov | Booking Holdings Inc | 600 | 21-Nov-32 | m/s+140a | m/s+105 | -35 | 5 | SEC | SEC | SEC |
| 18-Nov | Booking Holdings Inc | 500 | 21-Nov-37 | m/s+165-170 | m/s+140 | -27.5 | 10 | SEC | SEC | SEC |
| 18-Nov | Booking Holdings Inc | 700 | 21-Mar-45 | m/s+200a | m/s+170 | -30 | 10 | SEC | SEC | SEC |
| 18-Nov | Roquette Freres SA | 600 | 25-Nov-31 | m/s+190-200 | m/s+150 | -45 | N/A | 1600 | 2.67 | 2600 |
| 18-Nov | Roquette Freres SA (Hybrid) | 600 | PNC5.25 | 5.875-6% | 5.5% | -43.75 | N/A | 1500 | 2.50 | 1800 |
| 19-Nov | SNAM S.p.A (SLB) | 750 | 26-Nov-31 | m/s+150a | m/s+123 | -27 | 5 | 2250 | 3.00 | 2500 |
| 19-Nov | Abertis Infraestructuras Finance B.V (Hybrid) | 750 | PNC5.25 | 5.375%a | 4.875% | -50 | N/A | 2600 | 3.47 | 2700 |
| 20-Nov | Goodman European Logistics Fund (Green) | 300 | 27-Nov-31 | m/s+180a | m/s+140 | -40 | -5 | 1350 | 4.50 | 2200 |
| 20-Nov | Smurfit Kappa Treasury Unlimited Company (Green) | 600 | 27-Nov-32 | m/s+145-150 | m/s+113 | -34.5 | 0 | 2800 | 4.67 | 3100 |
| 20-Nov | Smurfit Kappa Treasury Unlimited Company (Green) | 600 | 27-Nov-36 | m/s+175-180 | m/s+143 | -34.5 | 0 | 3100 | 5.17 | 3250 |
| 20-Nov | Deutsche Telekom AG | 850 | 04-Jun-35 | m/s+125a | m/s+95 | -30 | 3 | 1900 | 2.24 | 2600 |
| 21-Nov | Prysmian S.p.A | 850 | 28-Nov-28 | m/s+175a | m/s+143 | -32 | N/A | 2600 | 3.06 | 2900 |
| 21-Nov | Prysmian S.p.A | 650 | 28-Nov-31 | m/s+205a | m/s+168 | -37 | N/A | 2100 | 3.23 | 2600 |
| 21-Nov | Iberdrola Finanzas S.A.U (Green, Hybrid) | 800 | PNC5.75 | 4.625-4.75% | 4.25% | -43.75 | 0 | 1850 | 2.31 | 3100 |
| 21-Nov | Worldline S.A | 500 | 27-Nov-29 | 5.75%a | 5.38% | -37.5 | 27.5 | 1900 | 3.80 | 2000 |
Source: IGM
Performance tracker of recent EUR IG/split-rated benchmark deals
| Issuer | Deal | Re-offer spread (m/s) | Current i-spread (bid) | Issue Rating |
| PRYIM | 3.625% 11/28 | +143 | +128 | BBB- |
| PRYIM | 3.875% 11/31 | +168 | +157 | BBB- |
| IBESM | 4.247% PNC5.75 | +198.3 | +201 | Baa3/BBB-/BBB |
| WLNFP | 5.250% 11/29 | +311.5 | +304.5 | BBB- |
| SW | 3.454% 11/32 | +113 | +107.5 | Baa2/BBB/BBB |
| SW | 3.807% 11/36 | +143 | +138 | Baa2/BBB/BBB |
| DT | 3.250% 06/35 | +95 | +94 | Baa1/BBB+/BBB+ |
| SRGIM | 3.375% 11/31 | +123 | +115 | Baa2/BBB+/BBB+ |
| ABESM | 4.870% PNC5.25 | +262 | +243.5 | BB/BB+ |
| NGGLN | 3.247% 11/29 | +100 | +92.5 | Baa2/BBB |
| NGGLN | 3.724% 11/34 | +140 | +131.5 | Baa2/BBB |
| BKNG | 3.250% 11/32 | +105 | +96 | A3/A- |
| BKNG | 3.750% 11/37 | +140 | +133 | A3/A- |
| BKNG | 3.875% 03/45 | +170 | +160 | A3/A- |
| ROQUET | 3.774% 11/31 | +150 | +152 | BBB |
| ROQUET | 5.494% PNC5.25 | +325.2 | +307.5 | BB+ |
| FDJFP | 3.000% 11/30 | +90 | +90 | Baa1 |
| FDJFP | 3.375% 11/33 | +110 | +115 | Baa1 |
| FDJFP | 3.625% 11/36 | +130 | +132 | Baa1 |
| RENAUL | 3.375% 07/29 | +127 | +133.5 | Baa1/BBB- |
| CTPNV | 3.875% 11/32 | +173 | +177 | Baa3/BBB- |
| KERFP | 3.625% 11/34 | +140 | +133.5 | BBB+ |
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