Enel has announced its issuance of hybrid bonds in dollars, as expected. The bond - as indicated yesterday by Reuters - is 60 years and callable after the tenth year, say the lead managers of the operation.
Leading the operation are JP Morgan, Bank of America Merrill Lynch, Barclays, Citi, Credit Suisse, Goldman Sachs, Morgan Stanley, MUSI and Mizuho. The bond matures in September 2073, with the first call in September 2023. If the call is not exercised, an increase to the coupon of 25 basis points will be applied. A further increase of 75 basis points will be applied if the 2043 call is not exercised. After the first call, the subsequent calls will fall every 5 years.
The subordinated bond has an expected rating of 'Ba1', 'BB+' and 'BBB-' from Moody's, S&P's and Fitch respectively. Instead, the issuer has ratings of 'Baa2', 'BBB' and 'BBB+' respectively, the first and third with a negative outlook, the second stable. The hybrid bond has the characteristic of weighing half on the issuers' balance sheets on equity and half on debt, a factor which should preserve the rating.
Enel had already issued a hybrid bond at the beginning of September, with a tranche in euros for 1,25 billion and one in pounds for 400 million. “The issuance in dollars usually ranges between 500 and 750 million dollars,” says a source close to the operation, while for another it could be as high as 1.000.
The latest hybrid issue in dollars in Europe is that of Edf which in January placed a multi tranche including one for 3 billion dollars with a tenth year call.
