Northland Power Inc. priced the first hybrid securities in Canadian dollars since the wipeout of similar notes from Credit Suisse Group AG shut global markets for the deals.
(Bloomberg) — Northland Power Inc. priced the first hybrid securities in Canadian dollars since the wipeout of similar notes from Credit Suisse Group AG shut global markets for the deals.
The Toronto-based power producer sold C$500 million ($377 million) of 60-year green notes that are callable after five years to yield 9.5%, according to people with knowledge of the matter. It is the first such debt to price in loonies since Feb. 28 when Intact Financial issued C$300 million of hybrids at a yield of 7.338%, according to data compiled by Bloomberg.
“The market is generally supportive of new issuance at this time, with investors willing to put cash to work,” said Furaz Ahmad, a Toronto-based corporate debt strategist at BMO Capital Markets. “I would say that with the AT1 market reopening in Europe, demand should slowly return for hybrids/junior sub-debt.”
The firm’s debt arrangers pushed ahead with the deal after carrying out an extensive roadshow with investors and after demand for hybrid securities in the global financial markets has shown signs of life. Last week, Paris-based Electricite de France SA issued $1.5 billion of perpetual notes with a call option after 10 years and this week Spain’s Banco Bilbao Vizcaya Argentaria SA and Bank of Cyprus sold the notes in euros.
Northland Power’s transaction drew 44 buyers who placed orders for about 1.5 times the deal’s size, according to people familiar with the matter. A representative for the company didn’t immediately reply to an email seeking comment.
(Adds final terms in first and second paragraphs and order book detail in fifth.)
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