ISTANBUL, June 20, 2014/PRNewswire — Turk Telekom’s US$ 1 Billion bond offering to refinance short term debt was about 8 times oversubscribed by international investors. This transaction proved to be a landmark issuance as the largest and first ever dual tranche corporate bond offering across two maturities issued out of Turkey.
Turk Telekom completed its book-building for its bond issuance, after a roadshow composed of senior delegation from the TT Group executive team, visiting over key institutional accounts in London, Los Angeles, Boston and New York. On the final day of the roadshow, on the back of overwhelmingly positive investor appetite and taking advantage of the low interest rate environment, Turk Telekom launched its debut transaction.
The US$ 1 billion inaugural issuance is carried out across two tranches, of US$ 500 M each, with 5 and 10 year maturities. On the back of Turk Telekom’s strong credit metrics, both tranches were successfully priced at 30 bps spread to Turkish sovereign issues of similar tenors. The 5-year tranche is priced at 99.6% with a 3.750% coupon. The 10-year tranche is priced at 99.165% with a 4.875% coupon.
The final orderbook of over US$ 5.5 billion was composed of a very high quality group of over 400 accounts of high grade and emerging markets investors across 40 countries. The final amount of US$ 1 billion bond was distributed fully to international investors from US (48%), Europe (25%), UK (20%), Middle East and Asia (7%).
This transaction enables Turk Telekom to refinance short-term portions of its debt with lower cost and longer tenor from new sources, thus diversifying and extending its funding base with more favorable terms. Turk Telekom’s successful inaugural bond issue, which is an important indicator of international investors’ confidence in Turkey and Turkish companies, also sets a new benchmark for other Turkish Corporates.
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Photo: http://photos.prnewswire.com/prnh/20140620/693508 Source: Turk Telekom