(Telestock) – Snam successfully completed the placement of his first perpetual subordinated bond issuefor a nominal value of 1 billion euros.
The issue, carried out in execution of the resolution of the Board of Directors of the Company dated 31 July 2024, was preceded by a day of investors meetings which has received strong support. The operation is aimed, among other things, at finance the possible acquisition of Edison Stoccaggiomaintaining financial flexibility to support the Group’s organic growth, as well as promoting greater diversification of the investor base.
Demand has exceeded supply by more than 4 times at the peak, totaling orders for an amount of over 4.5 billion euros.
The bond loan, issued in a single tranche of 1 billion of euros, is non-convertible, perpetual subordinated and payable only in the event of dissolution or liquidation of the Company, as established in the relevant terms and conditions.
The annual fixed coupon of 4.500% will be paid up to the first reset date (excluded) of the December 10, 2029. From that date, unless it has been fully repaid, the bond will mature a interest equal to the five-year Euro Mid Swap rate increased of an initial margin of 216.2 basis pointsThe margin will increase by 25 basis points to start from 10 December 2034 and further 75 basis points from 10 December 2049. The fixed coupon is payable annually in arrears in December, starting from December 2024. The issue price is set at 99.448% and the effective yield at the first reset date is equal to 4.625% per annum.
The expected date for the settlement is September 10, 2024.
“The inaugural issuance of hybrid instruments represents a crucial step in Snam’s growth path on the capital markets. This new instrument allows us to finance the recent acquisition of Edison Stoccaggio while maintaining the current financial flexibility and maximizing the contribution to the net profit growth due to the acquisition, which we expect to be between 1.5% and 2.0%, while we continue to implement our ambitious strategic plan that includes 11.5 billion euros of investments in the period 2023-27. The market reception beyond expectations has led us to obtain an extraordinary result both in terms of amount and yield, testifying to the solidity and credibility of Snam on the market,” commented Snam CFO Luca Passa.