Finns prove the yankee market still works

Issuer: UPM-Kymmene
Amount: $600 million
Issue type: yankee bond
Launched: November 24
Bookrunner: Merrill Lynch

Last month, following weeks of bond-market uncertainty, cancelled new issues and widening secondary-market spreads, Finnish paper company UPM-Kymmene and Merrill Lynch made a strong showing in the yankee market with a new issue that was heavily oversubscribed and was double the $300 million originally sought. It is one of the largest-ever corporate yankee issues from Scandinavia.

The success of UPM-Kymmene's first yankee, which totalled $600 million split into a $225 million 10-year tranche and a $375 million 30-year tranche, confirms that the US market remains open to investment-grade corporates - even to less than top credit quality companies previously little known in the US. According to Patrick Currie, director at Merrill Lynch: "If a deal is marketed properly and broadly and the right story is told, issuers can still do size in this market."

The deal...