IFR Capital Markets Week Ahead - September 26, 2016
* Bank of England starts corporate purchases
* Argentina hits euro bond market
* China Merchants Securities opens books
By Gareth Gore
LONDON, Sept 26 (IFR) - Welcome to the IFR Capital Markets Week Ahead - a new weekly email newsletter from Thomson Reuters IFR.
OLD LADY GOES SHOPPING The Bank of England will crank up its £10bn corporate bond purchase scheme on Tuesday, launching the first of what will be three weekly auctions. Even before it's begun, the QE programme has brought the sterling market alive, with £8.45bn of bonds printed since the purchases were announced on August 4 .
Engineering services company Babcock hopes to add to that tally with a bond sale expected this week. Still, the programme has already caused a stink. Many are confused as to why issuers like Apple and McDonald's meet the BoE's purchase criteria of being sufficient contributors to the UK economy, while RWE and Telefonica don't.
HIT LIST Telxius, the telecom towers spin-off from Spain's Telefonica, will close books on its 2bn IPO this Thursday. European ECM bankers had been on course for their worst year since the early 2000s, but a flurry of deals in recent weeks, including the US$2.4bn listing of Nets and a planned 5bn spin-off from RWE, could keep the job cuts at bay. CRYAN IN THE DESERT Hundreds of executives and investors converge on Arizona for a closely watched leveraged finance conference. The US election will be a major theme at the gathering - as will Deutsche Bank, the under-fire German lender that has been hosting the annual meeting for 24 years. CEO John Cryan will be in attendance . REMEMBER ME? Argentina returns to the euro market for the first time in 16 years, with investor meetings starting today. The country sold US$16.5bn of bonds back in April, in a triumphant return to markets following its 2001 default. It said at the time it was done for the year, but sold more bonds two months later - and is now coming back for more. WITHOUT A PEER Zopa will provide a fresh test of investor sentiment towards marketplace lending with the first European securitisation backed by peer-to-peer consumer loans. The UK group wrapped up a three-day roadshow last week for its Marketplace Originated Consumer Assets 2016-1 deal. It could print this week. BROKING A DEAL Shanghai-listed China Merchants Securities opens books on its Hong Kong listing, a deal the brokerage hopes will raise as much as US$1.5bn to fund expansion at home and overseas. About 10 cornerstone investors including Chinese insurers and state-owned companies are expected to snap up 60% of the deal. PHOTO FINISH Spanish renewable energy company Abengoa has indicated that it expects to win the support of 75% of its creditors for a restructuring plan by the end of this week. The Seville-based firm borrowed heavily to fund an aggressive expansion into clean energy, and has been negotiating since November to cut its debt of over 9bn. GULF BORROWERS LINE UP Kuwait National Petroleum Company heads a list of cash-hungry Gulf entities looking to raise substantial financings in the loan market. The oil company is in talks for a US$6.4bn loan. Meanwhile Dubai is seeking US$2.5bn to fund the expansion of a metro line, and Oman is also talking to banks. LIBOR HEARING Two former Deutsche Bank traders indicted for allegedly engaging in a scheme to manipulate Libor are set to appear for a hearing in a New York court on Wednesday. Matthew Connolly and Gavin Campbell Black are charged with one count of conspiracy to commit wire fraud and bank fraud and nine counts of wire fraud . TRIBUNAL Venkatesh "Venky" Vishwanathan, former co-head of corporate finance for Asia and head of capital markets and treasury solutions for Asia at Deutsche Bank, will have claims he was unfairly dismissed by the bank heard at a London employment tribunal on Wednesday.
LAST WEEK IN NUMBERS 13,500 - Number of firms using "passporting" for easy access between the UK and EU US$673bn - Drop in cross-border lending to emerging markets over last seven quarters 0% - Bank of Japan's new target yield for 10-year government bond securities US$12.1bn - Size of Shire bond to help finance its acquisition of Baxalta (Reporting by Gareth Gore; Editing by Marc Carnegie)
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