Spain’s Telefonica has priced an €850m (US$1.06bn) perpetual bond at par.
The bond, issued by Dutch subsidiary Telefonica Europe and guaranteed by the parent company, will have an interest rate of 4.2% up to 4 December 2014, the Spanish incumbent…
Spain’s Telefonica has priced an €850m (US$1.06bn) perpetual bond at par.
The bond, issued by Dutch subsidiary Telefonica Europe and guaranteed by the parent company, will have an interest rate of 4.2% up to 4 December 2014, the Spanish incumbent said in a stock exchange filing.
From then on, the securities will accrue interest at a fixed rate equal to the applicable five-year swap rate plus a margin of 3.806% up to 4 December 2024, of 4.056% up to 4 December 2039 and of 4.806% per year from 4 December 2039 onwards.
The securities will have a face value of €100,000 and no set maturity date, although they will be subject to a call option five years from the issue date and under certain agreed circumstances.
The pricing was equivalent to 409.4bps over mid-swaps.
Barclays, BNP Paribas and Unicredit were the lead managers for the offering, according to Reuters.
Moody’s has rated the bond, to be listed on the London Stock Exchange, Baa2.
The Madrid-based telecoms giant issued a similarly-sized bond last month: a 15-year €800m (US$1.01bn) bond with a 2.932% coupon.
In mid-September, Telefonica issued €1.5bn worth of convertible notes to help finance its €8.6bn takeover of German mobile operator E-Plus.
Also in September, Telefonica agreed a €7.24bn cash-and-stock deal to purchase Brazilian broadband unit GVT. The telco will fund the cash component of the deal with a capital increase at its Brazilian mobile unit Vivo. It will subscribe to this to keep its current 74% stake, funding this, in turn, with a capital increase at group level.
