March 25, 2013 / 11:31 AM / 5 years ago

A.P. Moeller-Maersk poised to issue sterling bonds

LONDON, March 25 (IFR) - Unrated Danish shipping conglomerate A.P. Moeller-Maersk on Monday announced plans for an investor call later in the day, ahead of a potential sterling-denominated bond issue.

Market observers said that a bond offering, which could come as early as Tuesday and will be arranged by Barclays, RBS and Santander GBM, would likely be very well received by investors.

As well as sterling supply having been relatively thin since the start of the year, the flow of unrated paper has been very limited too.

The company was last in the public market in August last year when it brushed off the usual mid-summer lull to price a EUR750m seven-year at 200bp over mid-swaps.

So far this year, only German construction company Hochtief and French retailer Rallye have priced unrated bonds, along with a smattering of other sub-benchmark deals from small-cap companies.

Bankers said, however, that issuance of unrated paper would likely pick up, as it can offer the yield that investors are hunting for in the current low-return environment.

Last month, A.P. Moeller-Maersk beat annual profit forecasts and predicted its container shipping business would benefit from a pick-up in world trade this year, helping to overshadow a warning on falling earnings at its oil business.

The Danish group is often considered a bellwether for global trade as its vessels make up 14% of world container shipping capacity. (Reporting By Josie Cox)

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