‘No one has been mandated yet, but we could end up with a situation in which one bank helps get the rating and two act as joint bookrunners,’ says a banker close to the transaction. Commerzbank Securities
and HVB Corporates & Markets
were also interested in advising on the rating process (MEED 2:7:04).
The bond is likely to be worth about Eur 300 million ($372 million) and it could be issued as soon as the fourth quarter.
Khodro’s recently established investment arm, Investment Banking Group (IBG)
, is promoting the bond. It says the company is hoping for a rating of BBB- or B+ with a positive outlook.
The proposed paper issue is expected to have a tenor of five years and it could pay a coupon of 6.25-7 per cent. No detailed discussions have been held over pricing, but a substantial spread over Iran’s sovereign eurobond – perhaps 100-150 basis points – is expected.
‘It’s difficult to know where the market would price Iranian risk. The sovereign debt is very thinly traded,’ says a bond trader.
IBG is also working on currency hedging for the manufacturer, which is estimated to have lost Eur 80 million ($99 million) last year in currency fluctuation. BNP Paribas and ABN Amro
are working on that deal, with talks under way with HSBC and Societe Generale
for future work.