(Finance) – Less cyclical issuers, a limited number of small operations and bonds used as preferred debt instruments have allowed Italian high-yield and leveraged issuers to benefit from favorable conditions of the debt capital market in Europe. Fitch Ratings states this in a report on the topic.
Favorable market conditions from 2023 have led to a fgreat demand from bond investors for speculative-grade debtsupported by significant capital inflows into high-yield funds and CLO formation. This factor, combined with stable credit quality for Italian issuers, has led to a strong wave of refinancing and some new deals in the country over the past 12-18 months.
THE national champions with “BB” rating have refinanced their next staggered maturities, while ‘B’ category LBO names have refinanced their capital structures, securing better terms to finance expansion.
Investors also showed a constructive approach towards dividend recapitalizations, subordinated debt issuances and epochal transformative agreements. In particular Telecom Italia has divested its fixed line network to Optics Bidco through a complex liability management exercise. This has helped eliminate the Italian performance premiums seen in the past, the report said.