Telekom Slovenije has mandated local bank NLB to organise and execute a commercial paper offering with an expected nominal value of €50m.
The bank will test the market for the offering and the telco will decide whether or not to proceed in March, a…
Telekom Slovenije has mandated local bank NLB to organise and execute a commercial paper offering with an expected nominal value of €50m.
The bank will test the market for the offering and the telco will decide whether or not to proceed in March, a company spokesperson said.
According to NLB, the commercial paper will have a nine-year maturity and the current yield offer is 3% per annum, although this may change, depending on demand. The 3% yield to maturity represented a spread of 261 basis points over 6m Euribor as at 10 February.
“Given Telekom Slovenije’s Ba2 credit rating by Moody’s, the offered yield is significantly higher relative to comparable securities in Europe, mainly due to country risk and high bank deposit interest rates in Slovenia,” an NLB spokesperson said. The bank expects Slovenian investors to generate the greatest demand, but foreign investors to express some interest.
NLB expects the issue to occur in mid-March. The security is to be traded on the Ljubljana Stock Exchange and the Slovenian incumbent intends to use the proceeds for the short-term financing of operations.
The results of Slovenia’s LTE spectrum auction are also expected in March.
Separately, the government has hired Citibank to act as financial adviser for its planned privatisation of Telekom Slovenije. Matthew Runjak of the Slovenian Restitution Fund (SOD), responsible for the tabled privatisations of 15 companies, was quoted in local publication Finance.si today as saying there are no official deadlines for the sales processes. However, he noted that the privatisation process for Telekom Slovenije is at a “preparatory phase”, adding that an optimistic scenario would see an agreement signed in July and the deal close in the autumn.
SOD did not respond to a request for comment.
