NEW YORK-France Telecom dug itself out of a deep hole when it sold $5.8 billion in euro-denominated bonds after raising the deal size from $3.2 billion in response to investor demand.
Morgan Stanley, BNP Parabas, Deutsche Bank, HSBC, and Schroder Salomon Smith Barney participated in the transaction, which is the carrier’s second round of debt financing in a month. In December, France Telecom raised another $3.2 billion in a euro-denominated debt deal.
“Given France Telecom’s cash position at the end of 2002, this new transaction more than covers the refinancing of debt maturing in 2003,” the company said in a statement.
France Telecom owes about $74 billion, and it has nearly $16 billion in debt repayments due this year.
The latest bond sale, which the carrier said it expects to be its last for this calendar year, allows France Telecom to avoid tapping a controversial $9.5 billion loan offer from the French government. The debt issue also helps pave the way for the telecom operator to go forward with its plans to raise nearly $16 billion in new equity sometime after it releases its Fiscal Year 2002 results in March.
