Telecom Italia has launched its planned hybrid bond issue, which is benchmark-sized and set to mature in 2073.
The Italian incumbent set initial price guidance on the 60-year euro-denominated bond issue, which will be callable every five years from…
Telecom Italia has launched its planned hybrid bond issue, which is benchmark-sized and set to mature in 2073.
The Italian incumbent set initial price guidance on the 60-year euro-denominated bond issue, which will be callable every five years from 2018, at about 8%, according to a source close to the deal. There will be a step up of 25 basis points in 2023 and of 75 basis points in 2038, the source said.
The subordinated bond will be senior only to share capital.
The benchmark size for such bonds is generally between €500m and €600m.
Lead managers for the transaction are Banca IMI, Barclays, BNP Paribas, JPMorgan and Mediobanca, the source confirmed.
Telecom Italia announced in early February that it would launch a hybrid subordinated debt securities programme of up to €3bn over an 18-24 month period and subsequently held an investor roadshow.
However, following Italy’s controversial elections, CEO Franco Bernabe said the company had decided to postpone the issue until market conditions improved.
The new issue is expected to be rated Ba2 by Moody’s and BB+ by Fitch and Standard & Poor’s.
