Corporate Debt

Short-seller attack raises Gautam Adani stakes

25 Jan 2023

Hindenburg reinforces how the $230 bln empire of the world’s third richest man is closely held, overvalued, and dismissed by Wall St. The upstart’s record of exposing U.S. fraud will make India sit up. But Adani is a giant target, and too many powerbrokers have a lot to lose.

Amazon creates bazaar for U.S. banking wannabes

24 Jan 2023

The e-commerce titan’s latest debt, an $8 bln loan, is curious, but not as much as the foreign institutions providing it. Australia’s ANZ, Spain’s BBVA, Singapore’s DBS and others rarely turn up in such deals. The likelihood of them leveraging this one into more business is slim.

Vodafone dials up India’s inefficient debt market

17 Jan 2023

Its top creditor, the government, is dithering on restructuring the telecom operator’s $27 bln of borrowings. A sustainable fix would leave New Delhi owning the company. What politicians do next will determine how deep India’s fight against bad debt goes.

Chinese convertible bonds set off cash crunch

13 Jan 2023

Video app Bilibili, e-commerce firm Pinduoduo and peers jumped on the convertible debt boom, issuing $27 bln worth since 2019. With share prices down, holders will want companies to buy the notes back early. As growth slows, their desperation is an opportunity for private equity.

China’s property debt red lines need a redraw

11 Jan 2023

The policy Beijing introduced in 2020 to cap developers' leverage is backfiring. The “three red lines” on debt ratios are now aggravating market stress and impairing balance sheets. Officials are considering blurring or moving the lines. They might have to erase them.

India’s Vodafone stress test may have ugly results

6 Jan 2023

The telecom operator needs cash to keep up with rivals. But top shareholders are reluctant to infuse much, and the government’s promise to swap some of Vodafone’s $27 bln net debt for equity hasn’t materialised. No one looks good and a long standoff will end up in a duopoly.

Asia debt craze spawns vicious tech funding circle

9 Dec 2022

India’s Byju’s wants easier terms on an existing $1.2 bln loan, one of a series of punchy deals the region’s hottest money-losing firms sold to BlackRock and others ahead of planned listings. Poor results and rising funding costs raise the stakes on getting IPOs across the line.

Capital Calls: Funky debt shock

29 Nov 2022

Concise views on global finance: Germany property group Aroundtown won’t be the last to flout bond market convention on hybrid debt.

Tycoons school banks in Indian retailer debt mess

25 Nov 2022

Thirteen suitors are queuing up to buy Future Retail out of bankruptcy, boding well for creditors’ prospects of resolving $3 bln of claims. Despite new rules, the saga has benefited Mukesh Ambani’s Reliance at the expense of lenders. Big business still has the upper hand.

Debt woes will restrain Enel’s global ambitions

22 Nov 2022

CEO Francesco Starace vowed to cut the 52 bln euro utility’s net debt by 21 bln euros, amid spiralling gas costs. Focusing on fewer regions looks sensible and may shield investments and dividends. But it will hinder Enel’s efforts to stay one of the top energy transition winners.

China’s property easing is minor capitulation

14 Nov 2022

Beijing has rolled out quick-fix measures like extending repayment periods to avert defaults and lowering mortgage down-payments, a signal that officials are sticking to their guns on deleveraging despite economic stress. That makes boosting the rest of the economy more urgent.

Fed gets credit for providing perpetual angst

8 Nov 2022

Investors in Asia are overreacting after a South Korean issuer flipflopped on a decision to exercise a call option on a $500 mln bond. Liquidity measures from Seoul eased an earlier rout but pressure from U.S. rate hikes is turning boring corners of finance into something hot.

Risky debt selloff has much further to run

28 Oct 2022

Investors are dumping corporate bonds as interest rates rise. Relatively safe investment grade securities have fallen harder than those issued by junk-rated borrowers, which hit $650 bln last year. That will reverse as high-yield debt starts pricing in defaults and a recession.

Sovereign debt greens yet net-zero pledges darken

13 Oct 2022

Saudi Arabia’s wealth fund is the latest public body to issue securities to fund renewable assets. Strong buyer demand and the chance to flaunt action on climate change explain the boom. Yet national decarbonisation targets remain weak, and green bonds do little to improve them.

Elliott’s double dip spares Citrix banks’ blushes

22 Sep 2022

Paul Singer’s hedge fund has made an unusual bet, picking up $1 bln of bonds backing its own buyout of cloud firm Citrix. The banks get shot of a balance-sheet albatross. And by getting a big discount on debt issued in a frothy market, Elliott benefits from their pain twice over.

Anxious Kaisa investors throw good money after bad

21 Sep 2022

Foreign bondholders in the Chinese property firm, which has $12 bln of offshore credit in default, are offering $2 bln to take over stalled projects plus restructure debt. A similar proposal failed last year, but as its woes worsen, Kaisa may reconsider. Pricing is the trick.

Adani’s Fitch debt spat is good news all round

8 Sep 2022

The U.S. group’s CreditSights unit rankled the $255 bln opaque Indian behemoth last month by calling it “deeply overleveraged”. But it got Adani’s executives talking more, and investors now have two clearer views of the company to weigh up. That’s a transparently good outcome.

Capital Calls: Chinese property bonds

16 Aug 2022

Concise views on global finance: Beijing plans to guarantee new domestic fixed-income issues by half a dozen homebuilders, but that’s hardly enough to revive overall demand for housing.

Capital Calls: Tech bros give Allbirds the boot

9 Aug 2022

Concise views on global finance: The maker of popular nondescript sneakers with a purpose is getting tripped up on demand. Its stock price pounding may make it vulnerable to a takeover.

China’s rental push could grease property slide

27 Jul 2022

Officials struggling to complete $300 bln of stalled apartment projects are mulling flipping them into leased units. More inventory is good in the long run but a falling housing market needs buyers more than renters. Depressing already low yields will deter investment.