When triple-B-rated French retailer Casino decided earlier this
year that it wanted to diversify its funding, it went for an issue
in the US private placement market. It duly did a nine-year deal
with a small seven-year tranche raising a total of $260 million at
the beginning of October. The transaction was sold to 11
investors.
Casino didn't have much choice. It had raised e700 million of
10-year debt in the public euro market by June this year but in
view of the way its public bonds denominated in euros were trading
at the end of September, it knew it wasn't going to be able to do
another big issue in euros, where it has 95% of its debt.
Its e1.1 billion March 2008 bonds were trading at 250 basis
points over Libor. The spread at launch on the third of its
fungible March 2008 issues had been as tight as 117.50bp...
