CORP SNAPSHOT: Iberdrola offers rarity with sterling green

Euro supply is off the menu Thursday in the high-grade space, leaving the spotlight on sterling where Iberdrola is working an opportunistic sale of 12yr green notes in benchmark size. That represents the second sale of sterling corporate paper this week to follow Monday’s well-received long-duration GBP500m 26yr green sale by ENGIE that was 3x covered at its UKT+120 reoffer.

More broadly though, and with the earnings cycle in play, few will have been surprised by the low volume of supply in recent sessions with Wednesday’s single currency additions bringing the week’s euro total to just EUR2.625bn in the high-grade space, and still below the EUR4.5bn guess.

There’s still potential to get closer to that estimate though where Verallia SA is concluding calls today ahead of a planned 8yr benchmark which could emerge as early as Friday.

There’s little to suggest that low supply seen this week is symptomatic of a shortage of buyers though. On the contrary, what did emerge yesterday offered further confirmation that investors still have cash to put to work in the euro credit market as they position for looming cuts in an ECB easing cycle that has a lot further to run. Debate continues regarding whether the ECB will go with a 25bps or 50bps cut at its December meeting but the cuts are coming.

Going conspicuously well Wednesday was Kingspan Group plc (EUR750m 7yr from benchmark) where a final orderbook of EUR3bn for its debut sale was enough to generate an impressive 4.0x cover ratio with leads carving 30bps from m/s +150 area IPTs. The deal is bid 2bps inside reoffer on Thursday morning.

And helped by its sub benchmark size, CA Immobilien Anlagen’s EUR350m no grow 5.5yr green was an even bigger 4.86x covered, marking its first euro sale in four years.

That will be of comfort to any issuers soon to be released from blackout and still wishing to get a deal away this side of the looming US election.

Iberdrola offering rarity with 12yr GBP green

** Iberdrola Finanzas, S.A.U. (Ticker: IBESM, Country: ES), guaranteed by Iberdrola, S.A., rated Baa1 (stb) / BBB+ (stb) / BBB+ (stb) Moody's/S&P/Fitch, has mandated Barclays, HSBC (B&D) as Global Coordinators and Barclays, Goldman Sachs Bank Europe SE, HSBC, Natwest Markets as Joint Bookrunners for a GBP Benchmark Bearer, REG S, NGN Senior Unsecured Green Notes due 31 October 2036 (12 year), exp ratings Baa1 / BBB+ /A- Moody's/S&P/Fitch. Pay date 31 October.

IPTs: ** UKT+120-125 bps **. Benchmark Gilt: UKT 4.25 03/07/36 | ISIN: GB0032452392

• According to IGM’s records, today's offering marks Iberdrola's first GBP sale since 2009
• Iberdrola has previously raised EUR3.6bn via three separate trips to the euro market in 2024

In the pipeline

** Verallia SA (Ticker: VRLAFP, Country: FR), the European leader and world’s 3rd largest producer of glass packaging for beverages and food products, rated Baa3 (stable) by Moody’s and BBB- (stable) by S&P, has mandated BNP Paribas, Crédit Agricole CIB, and CIC as Joint Global Coordinators to arrange a series of fixed income investor calls 23-24 Oct. A € Benchmark, RegS Bearer, senior unsecured, offering expected to be rated BBB- by S&P with a maturity of 8 years will follow, subject to market conditions. The net proceeds of the issuance will be used to refinance part of the existing financial indebtedness of the Group, to which some of the Joint Lead Managers are party, and for general corporate purposes. Marketing concludes Thursday, Issuer is engaged with 100+ investors via group calls and deal roadshow

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

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