18-11-2024

Last Saturday, Milano Finanza dedicated an entire page to corporate bonds, with a special section focused on the bond issued by Almaviva. Christian De Felice, Almaviva’s CFO, described it in detail in an interview conducted by Fausto Tenini.

“Almaviva was able to take advantage of the favorable conditions for corporate issuances. A €725 million bond (5% coupon, minimum denomination €100,000, maturing in October 2030) was recently issued, aimed at fully financing the acquisition of Iteris (with an annual revenue of $180 million) and simultaneously redeeming the pre-existing bond loan of €350 million, originally maturing in 2026.”

“The issuance was successful because, despite the rise in interest rates compared to the last issuance in 2021, the pricing came out in line with the previous one, also considering that the duration isn’t 5 years, but more than 6,” commented Christian De Felice.

“The quality of the book is very high because it’s made up of the most important institutional investors, who have been following us continuously since 2017, when we first entered the capital market. With this operation, we’ve stabilized the capital structure for the coming years, which will allow us to remain focused primarily on the business.”

Demand for the bond was 2.4 times the supply, showing a significant drop in the yield differential compared to the average value of BTPs with the same maturity, currently at +280 bps (at the time of issuance) compared to +530 bps for the 2021 bond. However, in that period, interest rates were close to zero, while today they’re just under 3% for bonds maturing in 5 years. This signals an increase in the company's perceived creditworthiness, with SeP and Fitch rating it BB and BB+, respectively.