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Volkswagen Gets 6.6 Billion Euros of Orders for Bonds (Update1) Oct. 10 (Bloomberg) -- Volkswagen AG, Europe's largest carmaker, received orders worth 6.6 billion euros ($9.3 billion) for a sale of 1.25 billion euros of five-year bonds. Volkswagen cut the yield premium on the debt by 3 basis points to 47 basis points over the benchmark midswaps rate, according to a statement from Societe Generale SA, one of the banks that organized the sale. The issue is the largest for the Wolfsburg, Germany-based company since June. Sales of corporate debt in Europe have surged since the Federal Reserve cut its benchmark rate on Sept. 18 to avert the threat to the economy from record U.S. home foreclosures. Companies and banks issued 74.4 billion euros of bonds since the Fed's cut, almost twice the amount sold in the three weeks before the central bank's reduction. ``Investors are now looking to buy some paper because we have seen some bonds coming at attractive levels,'' said Bernard Laliere, who helps manage about $11 billion of fixed-income assets at Petercam SA in Brussels. ``The premiums on offer in the primary market are really attractive at the moment.'' The yield premium on the debt was as much as 20 basis points more than the cost of credit-default swap contracts on Volkswagen debt, according to Societe Generale. That means investors can insure against default and still earn 20 basis points more than benchmark rates. A basis point is 0.01 percentage point. Credit-default swaps are used to speculate on a company's ability to repay debt and rise as perceptions of credit quality deteriorate. Yield Declines The extra yield investors demand to hold Volkswagen's 4.875 percent bonds sold by its Volkswagen Leasing GmbH unit fell 7 basis points to 40 basis points over the midswaps rate, according to RBC Capital prices. Fund managers and banks bought 75 percent of the debt, according to Societe Generale. Moody's Investors Service ranks Volkswagen AG debt at A3, its seventh-highest investment grade rating. Standard & Poor's grades the debt an equivalent A-. BMW AG, the world's largest carmaker, today followed Volkswagen to the bond market, with plans to sell five-year bonds denominated in euros. Last Updated: October 10, 2007 11:20 EDT http://www.bloomberg.com/apps/news?pid=20601085&sid=aCDiJ1LR… |
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| aus der Diskussion: | Porsche übernimmt Volkswagen.... |
| Autor (Datum des Eintrages): | Grisaldi (11.10.07 16:50:08) |
| Beitrag: | 2,649 von 4,181 (ID:31941622) |
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