11/16/23 7:21 p.m.
It’s not cheap! it makes :
• for a 5-year senior bond for 700 million euros (maturity on November 22, 2028) which will carry a fixed annual coupon of 5.25%, each year 36.75 billion euros to be paid in coupon, i.e. a total of €183.75 billion in coupons to be paid.
• for an 8-year senior bond for 700 million euros (maturing on November 22, 2031) which will carry a fixed annual coupon of 5.75%, each year 40.25 billion euros to be paid in coupon, i.e. a total of €322 billion in coupons to be paid.
This increases the bill by a total of €505.75 billion, or for €1,400 billion in financing, a negative impact of +36.125%
17/11/23 10:25
L’Oréal has had much better treatment in the bond market.
https://www.abcbourse.com/forums/msg1007912_l-oreal-emission-obligataire-de-1-5-milliard-d-euros
We must surely judge that its activity is less risky and that the balance sheet is better.
Taking financial risks to generate growth will pay off much less in stock prices.
Interest and renegotiated coupon charges currently pass directly and permanently into the accounts. It should be noted that some companies even prefer to anticipate the rollover of debt in the hope of having better processing conditions than later with a possible risk of continued increases in rates and a crisis of confidence regarding the files to be financed.
A rather wise reasoning, but which nevertheless has its limits if the level of debt is high.