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CREDIT SUPPLY: MTU Aero Engines (MTXGR Baa3[P]/NR/BBB): New Issue FV

CREDIT SUPPLY
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  • IPT: MTU Aero EUR Benchmark 7Y MS+200 Area.
  • We see FV at MS+160-170. In our view this should around 10-20bp wide to where ROLLS would be for the same maturity, which has sold off recently on the A350 story. It’s credit recovery appears behind that of ROLLS for now. That would put this in line with some of the wider low BBB names, so we see that as reasonably conservative.
  • Pre 2023 PW1100 problems, spreads traded around the same level as HEIGR, although we can’t speak to historical bond technical.
  • It has just the €500mn 07/25s outstanding, callable 04/25.

  • Moody’s moved to outlook positive this week.

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  • IPT: MTU Aero EUR Benchmark 7Y MS+200 Area.
  • We see FV at MS+160-170. In our view this should around 10-20bp wide to where ROLLS would be for the same maturity, which has sold off recently on the A350 story. It’s credit recovery appears behind that of ROLLS for now. That would put this in line with some of the wider low BBB names, so we see that as reasonably conservative.
  • Pre 2023 PW1100 problems, spreads traded around the same level as HEIGR, although we can’t speak to historical bond technical.
  • It has just the €500mn 07/25s outstanding, callable 04/25.

  • Moody’s moved to outlook positive this week.