ELPE announces October return to capital markets

ELPE (Hellenic Petroleum) will return to international money markets in October with a new bond issue to refinance an exisiting 500 million-euro bond maturing in May, 2017, the Greek corporation has announced.

The initiative, which will test the intentions of foreign investors, will concern the issue of a five-year bond to mature in 2021, planned to refinance a bond issued by the corporation three years ago at an interest rate of 8 percent and also help service ELPE’s loan commitments.

The new bond issue’s interest rate will depend on the conditions and level of interest expressed by foreign investors. According to sources, ELPE will be hoping for an interest rate of around 5 percent. Greek 10-year state bonds are currently being traded at levels of around 8.3 to 8.5 percent.

ELPE’s upcoming bond issue will be offered through the Luxembourg bourse while Credit Suisse Securities (Europe) Limited, HSBC Bank PLC, Eurobank Ergasias, Alpha Bank, National (Ethniki) Bank and Piraeus Bank will all serve as the issue’s joint bookrunners.

A minimum order amount of 100,000 euros will be set for the new bond issue.

Though ELPE, a heavily export-oriented corporation, does not accurately reflect the Greek economy’s fate, its upcoming bond issue could be interpreted as a prelude to bailout-dependent Greece’s return to international capital markets. The country’s reemergence in markets is being widely touted for some time within 2017. Such an initiative is not feasible at present given the performance of 10-year state bonds, which have steadily offered yields of 8.3 to 8.5 percent over the past few months.