CORP SNAPSHOT: Surprise French deal hits screens

With a no-confidence vote scheduled for Wednesday that may see the current French government ousted, perhaps the last thing most of the market would have expected today was new corporate bond issuance. In a further eye-catching twist, the issuer pushing ahead is none other than the French-domiciled Veolia Environnement which is touting a new long 6yr (Jan 2031 maturity) conventional line at IPTs of m/s+135.

The only movement of note in the IG corporate market Monday came in sterling thanks to UK name Saltaire Finance plc (guaranteed by The Secretary of State for Housing, Communities and Local Government). Having tapped an existing Sep 2033 secured line for GBP83.5m as recently as 20th Nov, the borrower went with a new GBP200m (GBP100m retained) 12yr secured line. IPTs were circulated at UKT+60 area before pricing was set at +49 by the way of +50 area (+/-1 WPIR guidance), on demand which peaked and finished at GBP470m.

In euros, and remaining in the pipeline for now, is Norwegian real estate company Public Property Invest ASA which hired leads for a two-day roadshow starting today ahead of an inaugural EUR300m (expected) 5.25yr line (comps here).

Live Deals

** Veolia Environnement SA, rated Baa1 stable / BBB stable (Moody’s / S&P), has mandated Crédit Agricole CIB (B&D) as Sole Global Coordinator and Crédit Agricole CIB, ING, J.P. Morgan, Santander as Active Bookrunners for a EUR500m (Will Not Grow) Senior, Unsecured, Regulation S, Bearer Dematerialized due 10th Jan 2031, exp ratings Baa1 / BBB (Moody’s / S&P). Pay date 10th Dec.

IPTs: m/s + 135 bp area

• Veolia last came to the market back on 2nd Sep 2024 placing the 10yr senior unsecured deal into books that finalised at EUR1.45bn (peak EUR2.2bn). Spread compression of 35bp was witnessed on that occasion to leave a c7.5bp NIC at m/s+100. That deal was seen on the comps list below at i+114
• Today's deal has seen IPTs released at m/s+135a or around a 40bp starting NIC based off the comps list circulated by leads. That is a similar concession to what we have seen previously from the issuer. The apparent lack of additional incentive on today's proposed transaction may point to the fact that the company generates a vast proportion of revenue from outside of France (only c.13% of revenues came from France in 2023) and also the recent widening of the secondary curve (as highlighted by the moves seen by the recent new 10yr)

Indicative, pre announcement, bid side, vs Mid Swap (I-spd):

New Mandates

** Citycon Treasury B.V., a Dutch domiciled subsidiary of Citycon Oyj (ticker: CITCON, country: FI), a leading owner, manager and developer of necessity-based retail properties in the Nordics & Estonia, has mandated Deutsche Bank and Nordea as Global Coordinators & Joint Bookrunners, and Danske Bank, OP Corporate Bank, SEB and Swedbank as Joint Bookrunners to arrange a series of fixed income investor calls to be held today on 3 December 2024. A Deal Roadshow presentation with pre-recorded voiceover will be made available. Nordea will be coordinating logistics.

A EUR 300m exp., Reg S, fixed rate, senior unsecured Green Bond offering with a 5.25-year maturity will follow, subject to market conditions. The transaction will be launched under the issuer's EMTN programme dated 29th Nov 2024. The notes will be unconditionally and irrevocably guaranteed on a senior unsecured basis by Citycon Oyj, rated BBB-, negative by S&P. The full net proceeds will be used to finance the concurrent any-and-all NOK tender offers as well as to repay existing indebtedness. An amount equivalent to the net proceeds will be used for financing and/or refinancing of Eligible Green Assets under Citycon’s Green Financing Framework dated March 2023 (the GFF and SPO are available at: https://www.citycon.com/investors/financing/green-financing).

Citycon has today separately announced a tender offer on its 3.900% NOK1.4bn notes due September 2025 (of which NOK1.3bn remains outstanding) (ISIN: NO0010744139) and 2.750% NOK1.0bn notes due September 2025 (ISIN: NO0010805898). The tender offer will expire on 9th Dec 2024.

A Deal Roadshow presentation (including voiceover) has been made available here

In the pipeline:

** Norwegian real estate company Public Property Invest ASA (BBB-) mandated Citi, Danske Bank, DNB Markets, J.P. Morgan and Nordea as Joint Lead Managers to arrange a series of fixed-income investor calls commencing 3-4 Dec. An inaugural EUR300m (exp) 5.25yr senior unsecured offering, expected to be rated BBB by Fitch, will follow. Use of proceeds will be general corporate purposes and to repay existing secured debt

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

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