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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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- The Comms/Tech indices underperformed €IG WoW to yesterday’s close by 1.2bp/1.7bp, bringing both to MoM underperformance of 1.1bp/1.2bp and YTD underperformance of 8.9bp/12.4bp.
- No TMT supply this week in line with the broader market though we did get a rating upgrade with Warner Music Group joining the IG universe for the first time as S&P’s upgraded to BBB- on strong industry growth trends backed by its large and diversified content portfolio. Their EUR 28s/31s are over 30bp tighter this week; https://marketnews.com/warner-music-group-upgraded-from-bb-to-bbb-to-ig-at-sp.
- Corning’s 31s have been quite volatile in recent sessions and sit as one of the week’s biggest movers; during the week we flagged that they were just off YTD wides and they have continued to tighten away from this level; https://marketnews.com/corning-31s-pare-july-outperformance-near-ytd-wides.
- Altice is selling it’s 24.5% stake in BT to Bharti Global starting with 9.99% with the remainder contingent on regulatory approval. The FT previously disclosed that Altice UK's funding of the stake involved funded collars, margin loans, and a EUR 0.6bn loan from Altice Int. so it appears the sale was due to liquidity needs. Bharti states no intent for a larger stake or takeover, citing confidence in BT management and strategy with Bharti now precluded under the Takeover Code from acquiring over 30% of shares or making related actions for six months. While the deal is has no real impact on underlying credit quality, the market took some relief from the perceived decrease in the likelihood of a takeover with spreads sitting up to 7bp tighter this week; https://marketnews.com/bharti-acquires-altices-stake-in-bt-indicates-no-desire-for-a-full-takeover.
- Last Friday after we published our review, Cellnex announced it had sold its Austrian towers for EUR 803mn with targeted completion this year though with EUR 272mn deferred to 2028. The proceeds are earmarked for buybacks which marks a shift away from the deleveraging focus though this was well flagged in the past and didn’t move spreads.
- Also noting outperformance by Hellenic Telecom after they reported last week in results that looked Q2 results looked mixed from a credit perspective with solid growth in Greece offset by ongoing struggles in Romania while EBITDAaL growth was modest and FCF declined though with net debt falling from 0.4x to 0.3x.
- CK Hutchison underperformed slightly after reporting what looked like decent Q2 results from a credit perspective with YoY revenue and EBITDA growth, capex reductions and slightly lower net debt though the group equity sold off on bottom-line softness due to one-off elements and taxes. Management declined to comment on the recent reports around a review of their European telco operations though the results note that they “will continue to explore LT value accretive transactions for our shareholders and will seek to strengthen our BS and overall financial profile”.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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