Telia Company has issued a bond of EUR 500 million in a 10-year deal maturing in November 2030 under its existing EUR 12 billion EMTN (Euro Medium Term Note) program.
Telia Company said it will use a part of the proceeds to refinance senior debt. The company is tapping the debt market in order to restructure and refund maturity profile as part of its long-term funding strategy.
The Re-offer yield of the bond was set at 0.197 percent per annum equivalent to Mid-swaps +45 basis points and a coupon of 0.125 percent.
On February 4, 2020, Telia Company, as the first telecommunications company in the Nordics, issued a green bond of EUR 500 million. The new hybrid bond has a maturity of 61.25 years with the first reset date after 6.25 years. The coupon is 1.375 percent and the re-offer yield has been set at 1.50 percent.
Telia Company’s net debt was SEK 80.309 billion at the end of the third quarter as against 83.789 billion at the end of the second quarter of 2020. The net debt/adjusted EBITDA ratio was 2.58x. Net debt/adjusted EBITDA ratio including 12 months adjusted EBITDA from Bonnier Broadcasting, was 2.5x.
Telia Company earlier said 2020 was impacted by higher repayments related to matured debt while 2019 was affected by the acquisition of Turkcell’s 41.45 percent share in Fintur.
Long-term borrowings increased to SEK 105,872 million (99,899) mainly due to issued bonds. Short-term borrowings decreased to SEK 9,449 million (19,779) mainly due to matured debt and partial repayment of loan under the revolving credit facility.
“We have identified an opportunity this late in the year to issue a 10-year bond in the Euro Debt Capital market at these attractive levels,” Agneta Wallmark, vice president and head of Group Treasury of Telia Company, said.
“Due to the strong demand from high quality investors, a very tight pricing was possible, and the coupon is the lowest ever for a Telia Benchmark senior bond,” Agneta Wallmark said.
A Tender Offer for buying back up to EUR 300 million of bonds maturing in 2021-2024 has also been announced. The Tender Offer constitutes part of the company’s ongoing proactive balance sheet management.
The Joint Bookrunners mandated by Telia Company for this transaction were Barclays, BNP Paribas, Credit Agricole and Nordea.