Reprieve Expected to Aid Telstra's Offshore Issues

Wednesday, December 06, 2000
Now that British Telecommunications' jumbo $10 billion global bond issue is out of the way, Australian Telstra's offshore issues, clear losers in recent sessions, can expect a slight reprieve, analysts said on Wednesday.

But while their spreads were unlikely to narrow much near-term, buying opportunities were emerging for medium to longer term investors, said National Australia Bank's senior analyst Phillip Strano.

Telstra's offshore issues not only offered considerable margin pick-up over comparable domestic issues, but also superior credit protection over many of its European counterparts, Strano said.

For example, the telco's U.S. dollar issue due 2005 was trading at around 80 basis points over swap while its domestic 2006 issue was trading at some 50 basis points.

Further, Telstra's single-A plus ratings from Standard & Poor's has a stable outlook and incorporates moderate flexibility for the company to make further strategic investments.

"There is arbitrage opportunities looking at offshore deals," said an analyst. "Event risks still circle this sector and we're recommending a more defensive stance. Offshore issues in the telco sector increasingly include step-up provisions, providing a greater degree of protection," he added.

BT's issue for instance offered step-up coupons that will rise by a quarter percentage point if its ratings fall at least two notches to triple-B plus or Baa1, and more if cuts ran deeper. The downgrade protection is a feature of other telco bond issues this year, among them Deutsche Telecom's $14.6 billion four-currency June megabond issue.

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter February 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Finance

Baltic Index Pauses at Record Low

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, ended flat on Thursday after declining for 12 straight sessions

Long Beach Sees Robust Container Growth

The Port of Long Beach kicked off 2016 by logging its seventh straight month of cargo increases, showing a 24.8 percent jump in container shipments over the same month last year.

Maersk Drilling Posts Record Profit

Maersk Drilling delivered the best result ever with a profit of USD 751m (USD 478m) in 2015 generating a ROIC of 9.3% (7.1%). The result was positively impacted

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Offshore Oil Pod Propulsion Port Authority Salvage Ship Simulators Shipbuilding / Vessel Construction
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.0717 sec (14 req/sec)