LONDON, Jan 4 (IFR) - Daimler, this year’s third auto credit, priced a €750m five-year floater through its curve on Thursday as investors scrambled to get their hands on the little corporate supply coming to market this week.
The company started marketing an expected €500m five-year at 30bp area over Euribor, before launching an increased €750m at a discount margin of 25bp on books of over €1bn.
At that level IFR calculations show the deal coming slightly inside fair value, which was around 26.5bp using bid-side quotes on Daimler’s May 2022 and July 2024 floaters.
In comparison, BMW, which sold a €2bn dual-trancher on Wednesday, offered premiums of 3bp-4bp on its 5.5-year and 3bp on the 10s.
A banker away estimated a similar fair value number of plus 27bp, although both were some way wide of the official 20bp-25bp range.
Daimler, rated A2/A/A- (all stable), issued the paper through sole lead UniCredit.
The frequent borrower followed in the footsteps of RCI Banque’s €750m five-floater on Wednesday. That came at 43bp over Euribor with a concession of around 2bp.
RCI and BMW have held up well in the secondary market. RCI was quoted at 39bp, while BMW’s shorter bond was at swaps plus 11.8bp, essentially flat to the 12bp reoffer, and the longer deal nearly 3.5bp tighter at swaps plus 21.6bp.
“The fact that supply is fairly low this week is down to a lack of issuers rather than appetite,” the banker away said.
“There’s been a lot of pre-funding in November and December, and the market remains strong as exemplified by investors’ response.”
* Final terms: €750m at DM+25. Books over €1bn (inc LM). (11:29am)
* Guidance DM+25/+28 (wpir), still exp €500m size. Books around €750m ex LM. (10:57am)
* Books €600m+ ex LM. (10:14am)
* IPTs DM+30 area, exp €500m size, pricing today. Due 11 Jan 2023, pay 11 Jan, EMTN docs, German law, Lux listing, 100k/100k denoms, Reg S bearer (Tefra D). (8am)
Daimler International Finance BV, guaranteed by Daimler AG and rated A2/A/A- (all stable), has mandated UniCredit Bank as sole bookrunner for a 5yr senior unsecured FRN issue. Proceeds will be used for GCP. (8am) (Editing by Helene Durand, Julian Baker)