<b>BT rings up hefty bill for global bond funding</b>
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<b>BT rings up hefty bill for global bond funding</b>

Headline: BT rings up hefty bill for global bond funding
Source: Euromoney
Date: January 2001
Author: Michael Peterson

Issuer: British Telecommunications
Amount: $10 billion
Type of issue: global bond
Date of issue: December 5, 2000
Bookrunners: Merrill Lynch, Morgan Stanley, Schroder SSB

As anyone who has ever browsed the web using a BT line will know, the internet can be an expensive compulsion. The unlucky surfer can run up a hefty telephone bill even before he finds what he is looking for.

Now British Telecommunications is facing a similar experience as it strives to create a UMTS wireless internet business. First came the sky-high cost of buying a UK licence in April. Then came months of relentless credit tightening as investors realized just how much BT and its peers would have to pay to build UMTS infrastructure.

But for BT, the real moment of bill shock arrived last month, with the launch of its inaugural dollar global bond, a mammoth $10 billion offering on which it will pay hefty coupons. But unlike so many of its customers, BT believes the bill was fair, at least in the circumstances. “We were delighted by the success of the bond issue,” says BT treasurer Andrew Longden.














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