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The deal consists of a EUR 650m 18-month FRN fixed at a spread of 50bp over thee-month Euribor (the tight end of +50bp-55bp guidance); a EUR 500m 18-month fixed-rate tranche at 50bp over mid-swaps (same guidance as the FRN); and a EUR 500m four-year fixed at a spread over 65bp over mid-swaps (through MS+70bp-area guidance), according to Bond Radar (www.bondradar.com).

Investor demand reached EUR 3.6bn in aggregate – EUR 1.2bn for the FRN; EUR 1bn for the short-dated fixed piece and EUR 1.4bn for the four-year. Leads underwriters for the deal had arranged global fixed-income calls on 7  October, the day after the deal was mandated.

Scope’s issuer rating on Vattenfall is supported by a number of factors: its leading position in many of its business segments; its low-carbon generation mix; and the stability afforded by the regulated, semi-regulated or contracted nature of a substantial part of its business. Additional factors include the vertical integration and horizontal diversification by business activity, power source and geography.

“These strengths balance the industry-inherent risks in unregulated power generation, which contributes over half of earnings, as well as cash flow volatility induced by sizeable capex and margin calls on the commodity hedge book,” said Tommy Träsk, Scope’s lead analyst for the company.

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