The Guinness and Smirnoff drinks giant Diageo provided a long-awaited pick-meup for the slumbering corporate debt market, raising $1bn via a five-year dollar-denominated bond. The issue, due January 2014, will be paying a coupon of 7.375% above what Diageo would ordinarily expect to pay in less creditconstrained times.
A new term has entered the mergers and acquisitions lexicon, with the contingent value right (CVR). Never before used in Europe but the brainchild of some smart Parisian bankers, the CVR is being credited with breaking the deadlock to deliver the £12.5bn takeover of the UK's single largest electricity generator British Energy by French group EDF.
The debt markets remained for the most part closed and there was very little action in the M&A or new equity issues markets either. What excited some investors was the prospect of the long-awaited consolidation of the legion of listed independent oil and gas exploration and production companies. Many analysts believe some of the explorers will merge with each other, but so far the indies have fallen to majors.
