A secure line to funding

For telecom companies tussling with rating agencies to preserve their investment credibility, it’s an appealing prospect: a bond that can be sold at 20 to 30 basis points over Libor, that will never be downgraded and that could provide much needed working capital when conventional capital markets are all but closed. Securitization offers this prospect.

So far, Telecom Italia is the only telecom company to make public plans to issue a securitized bond.