It took Ford nearly six years to dig itself
OUTûOFûHIGH
YIELDûSTATUSûINû ûFOLLOWINGû
the company’s near collapse in 2006 that
NECESSITATEDûTHEûBORROWINGûOFû53BNûATû
THEûTIME
BREWERY GIANT AB INBEV AVOIDS
DOWNGRADE
Drinks giant AB INBEVûSTAVEDûOFFûAû-OODYSû
downgrade after halving interim dividends
as it prioritised deleveraging over
STOCKHOLDERûREWARDS û#REDIT3IGHTSûSAIDûLASTû
WEEK
-OODYSûWARNEDûEARLIERûTHISûMONTHûTHATû
THEû!
RATEDû"ELGIANûBREWERûCOULDûFALLûTOû
4RIPLEû"ûTERRITORY ûCITINGûSLOWûPROGRESSûINû
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ACQUISITIONûOFû3!"-ILLERûTWOûYEARSûAGO
h7EûWOULDûTHINKû!"û)N"EVûMANAGEMENTû
has done enough to restrict a downgrade
FROMû-OODYSûTOûONEûNOTCHû"AA vû
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“It might also stave off draconian action
FROMû30 ûWHICHûHASûAûNEGATIVEûOUTLOOKûONû
ANû!
ûRATING vûITûSAID
Ratings agencies have turned up the heat
on companies that have not met
commitments to reduce debt following
LARGEûACQUISITIONS
"ONDSûISSUEDûBYû!"û)N"EV ûWHOSEûBRANDSû
INCLUDEû3TELLAû!RTOIS û"UDWEISERûANDû#ORONA û
WEREûLOOKINGûSTRONGERûONû4HURSDAY ûTHOUGHû
STILLûFARûOFFûTHISûYEARSûHIGHS
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TRADEDûBONDSûONûTHEûDAY ûWASûCHANGINGû
HANDSûATûAûDOLLARûPRICEûOFû ûORûBPû
OVERû4REASURIES ûACCORDINGûTOû-ARKET!XESSû
DATA
That was about 30 cents higher on the
DAY ûBUTûOFFûAûHIGHûOFûûONû/CTOBERû û
WHENû-OODYSûPLACEDû!"û)N"EVSûSENIORû
SECUREDûRATINGûONûREVIEWûFORûAûDOWNGRADE
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ATû ûUPûOVERûAûPOINTûFROMûTHISû
MORNINGSûLEVELS
4HEûCOMPANYSûSTOCK ûHOWEVER ûDROPPEDû
MOREûTHANûûTOûõûONû4HURSDAYû
FOLLOWINGûNEWSûOFûTHEûDIVIDENDûCUT
The company has seen beer sales decline
INûITSûBIGGESTûMARKETSû
ûTHEû53ûANDû"RAZILû
û
while its numbers have also been hit by
HYPERINmATIONûINû!RGENTINA
4HIRD
QUARTERû%BITDAûJUMPEDûûONûAû
LIKE
FOR
LIKEûBASISûTOû53BN ûBUTûTHATûWASû
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TOû2EUTERSS&P WARNS IT MAY CUT XEROX TO JUNK30ûWARNEDûITûMAYûDOWNGRADEû53ûPHOTOCOPIERû
and printing company XEROX to junk on
EXPECTATIONSûREVENUESûWILLûREMAINûWEAK
The ratings agency placed its BBB- rating
ONû#REDIT7ATCHûNEGATIVEûANDûSAIDûITûPLANNEDû
to conclude the review within the next two
MONTHS
The rating action came a day after Xerox
missed revenue estimates but beat those for
PROlTûFOLLOWINGûCOST
CUTTINGûINûITSûlRSTûFULLû
quarter under new management backed by
activist investors Carl Icahn and Darwin
$EASON û2EUTERSûREPORTED
h7EAKûREVENUEûTRENDSûWILLûLIKELYûPERSISTû
OVERûTHEûNEARûTERM ûPRESSURINGûITSûABILITYûTOû
sustain a balance sheet commensurate with
ANûINVESTMENT
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SAID
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)TSûûSûWEAKENEDûTHEûMOST û
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ACCORDINGûTOû-ARKET!XESSû)TûPRICEDûATûBPû
OVERû4REASURIESûINû3EPTEMBERûLASTûYEAR
Just a one-notch downgrade would tip the
RATINGSûOFû8EROXûINTOûJUNK
Fitch already downgraded it into high
YIELDû"" ûINû!UGUST ûDUEûINûPARTûTOûTHEû
COMPANYûTERMINATINGûAû53BNûMERGERû
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8EROX
30SûTHREATûCOMESûAMIDûWORRIESûABOUTû
the growth of the Triple B debt - which
ACCOUNTSûFORûABOUTûHALFûOFûTHEû53TRNû53ûcorporate bonds outstanding - and the
ability of the high-yield market to absorb
SOMEûOFûTHATûDEBTûIFûITûFALLSûINTOûJUNK
/NûANûEARNINGSûCALLûLASTûWEEK ûCHIEFû
executive Giovanni Visentin said the
company plans to improve revenues by
SIMPLIFYINGûTHEûORGANISATIONALûSTRUCTURE û
improving alignment of compensation and
EVALUATINGûCONTRACTSûTHATûAREûNOTûPROlTABLE
#&/û7ILLIAMû/SBOURNûSAIDûONûTHEûSAMEû
CALLûTHATûDEBTûWASû53BNûATûTHEûENDûOFûTHEû
THIRDûQUARTER ûANDû53BNûOFûCASHûWASûONû
THEûBALANCEûSHEET
h!SûTHEûDEBTûLADDERûSHOWS ûWEûHAVEûNOû
REMAININGûMATURITIESûINû ûWITHûOURûNEXTû
MATURITYûOFûAPPROXIMATELYû53Mû
COMINGûINû-ARCHûOFû vû/SBOURNûSAID
-OODYSûRATESû8EROXûATû"AAFOX BONDHOLDERS STRIP COVENANTS
FOR DISNEY EXCHANGEWALT DISNEY has won overwhelming approval
from investors to strip protections from
53BNûOFûTWENTY-FIRST CENTURY FOX bonds
AHEADûOFûAûPLANNEDûEXCHANGE
4HEûMOVEûTEESûUPû$ISNEYûTOûOFmOADûASSETS û
NOTABLYû2EGIONALû3PORTSû.ETWORKS ûTOûSATISFYû
anti-trust concerns as Disney prepares to
CLOSEûITSû53BNûACQUISITIONûOFû&OXûNEXTû
YEAR ûSAIDû+ENû"ERLIN ûSENIORûRESEARCHûANALYSTû
WITHû,EGALûû'ENERALû)NVESTMENTû
-ANAGEMENTû!MERICA
,ASTûWEEK ûûOFû&OXûBONDHOLDERS ûASûAû
PERCENTAGEûOFûPRINCIPAL ûVOTEDûTOûREMOVEûTHEû
COVENANTS ûWHICHûOTHERWISEûCOULDûHAVEû
SLOWEDûTHEûSALEûOFû23. ûHEûADDED
He said Disney has six months after the
ACQUISITIONûCLOSESûTOûSELLû23. ûBUTûWANTEDûTOû
make sure the pieces are in place as early as
POSSIBLE
“Disney wants to have its ducks lined up
and not have any administrative or covenant
issues blocking them from doing what they
need to do to complete this multifaceted
TRANSACTION vû"ERLINûTOLDû)&2ALL INV-GRADE US CORPORATE BONDS
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 BAML 71 15,535.95 11.5
2 JP Morgan 67 13,923.19 10.3
3 Morgan Stanley 46 10,795.01 8.0
4 Barclays 47 9,609.47 7.1
5 Goldman Sachs 35 8,737.74 6.5
6 Wells Fargo 57 8,142.35 6.0
7 Citigroup 41 7,853.85 5.8
8 Mizuho 33 7,360.33 5.5
9 MUFG 29 4,865.27 3.6
10 RBC 33 4,492.96 3.3
Total 189 134,976.20
Excluding equity-related debt, ABS/MBS, all foreign issues, global issues
and non corporates.
Source: Refinitiv SDC code: F6a
ALL US INVESTMENT GRADE CORPORATE DEBT
(EXCLUDING SOLE SELF FUNDED DEALS)
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 BAML 322 104,741.77 11.1
2 JP Morgan 354 101,761.66 10.8
3 Citigroup 300 82,773.14 8.8
4 Goldman Sachs 230 75,447.45 8.0
5 Morgan Stanley 269 72,434.51 7.7
6 Barclays 173 59,491.88 6.3
7 Wells Fargo 215 57,450.18 6.1
8 HSBC 109 35,661.54 3.8
9 RBC 130 31,968.69 3.4
10 Mizuho 116 29,692.65 3.2
Total 849 941,008.68Source: Refinitiv SDC code: F09aALL CORPORATE BONDS IN EUROS
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues €(m) (%)
1 BNP Paribas 140 23,147.25 8.3
2 SG 113 20,691.28 7.4
3 Deutsche Bank 107 20,324.68 7.3
4 HSBC 103 14,869.95 5.3
5 Credit Agricole 87 14,567.64 5.2
6 JP Morgan 90 14,257.47 5.1
7 UniCredit 82 14,053.73 5.1
8 Goldman Sachs 60 13,683.36 4.9
9 ING 64 12,066.51 4.3
10 BAML 64 11,676.83 4.2
Total 428 278,226.15
Excluding equity-related debt. FIGs, ABS/MBS.Source: Refinitiv SDC code: N8