RWE today launched a hybrid bond with a volume of 500 million USD. It was aimed primarily at Asian investors in Hong Kong and Singapore and was more than four times oversubscribed. The RWE bond is the first hybrid bond from a European utility in the Asian capital market. The high level of demand demonstrates the confidence that RWE receives from investors, as well as the company’s acceptance as a reliable issuer.
RWE is thus consistently implementing the hybrid programme that it announced in August 2011 as part of a wider package of measures designed to improve its capital structure. This is RWE’s fourth hybrid bond following the successful launches of hybrids denominated in Euro in 2010, Swiss Franc in 2011, and Sterling in 2012.
The hybrid bond matures in 2072, but RWE has the right to repayment after a period of five-and-a-half years. Hybrid bonds are a mix of equity and debt, and offer a higher coupon than normal bonds. The RWE hybrid offers a coupon of 7.0% with an issue price of 100%. Joint lead managers were Citigroup, BNP Paribas and Nomura, as well as Bank of America Merrill Lynch, Credit Suisse and UBS.