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Now you has Jazztel

Issuer: Jazztel

Amount: €110 million and $100 million

Type of issue: high-yield bond
Date: April 8

Bookrunners: Credit Suisse First Boston, Merrill Lynch

In 1997 and early 1998, before it was virtually extinguished by last autumn's flight from credit, Europe's fledgling high-yield market found the bulk of its deals in telecoms. Now that the market is spluttering back into life, it is no surprise that telecoms deals are again leading the way. The deal that opened the market, for example, was for Dutch communications company Hermes Railtel in December. But the recent deal for the Spanish telecoms operator Jazztel is a little unusual.

Most obviously that's because it is Spain's first high-yield deal. But more importantly, it provides an example of an early-stage borrower raising money successfully by issuing bonds to European investors. Jazztel was formed in October 1997 and only begins offering a service to Spanish telephone customers this year.

The bond issue, which closed on April 8, had two tranches, one for €110 million and one for $100 million. Both were for 10 years, with a 14% coupon, and included warrants for equity. The two bonds combined could convert into a total of 10% of Jazztel's equity.

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