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HeidelbergCement issues €1 billion Eurobond

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World Cement,

HeidelbergCement priced a Eurobond issue under its €10 billion EMTN programme with an issuance volume of €1 billion and a maturity date of 30 March 2023.

The bond was issued at the upper end of the volume and the lower end of the coupon range. Demand was very high; the bond was more than 3 times oversubscribed.

The 7-year bond bears a fixed coupon of 2.25% per year. The issue price is at 99.616%, resulting in a yield to maturity of 2.31%. These terms are the most attractive HeidelbergCement could ever secure in this maturity segment. Active Bookrunner of the transaction are Bank of America Merrill Lynch, Commerzbank, ING, Morgan Stanley (B&D) and Nordea.

The proceeds will be utilised for general corporate purposes and especially to pre-fund the upcoming Italcementi acquisition. Thereby the volume of the bridge financing will be reduced from €2.7 billion to the minimum volume required for the mandatory takeover offer of €2 billion. The refinancing needs in the bond market decline to below €1 billion in line with the issuance volume.

As already communicated in the announcement of the Italcementi acquisition, the bridge financing should be refinanced by free cash flow, the sale of production sites and the issuance of bonds.

Adapted from press release by Joseph Green

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