By Serena Ruffoni
Dutch telecommunication company KPN NV (KPN.AE) plans a euro-
and sterling- denominated hybrid bond, said one of the banks on the
deal Thursday.
The company already met investors in late February for this
bond, which comes as part of a 4 billion euro ($5.21 billion)
capital-raising plan.
The bond will be subordinated and senior only to ordinary share
capital, meaning it is the second to last in the repayment order in
case of default of the company.
A euro-denominated perpetual bond has a yield indication of
around 6.5%, while a 60-year sterling-denominated bond is indicated
at a yield of around 7.375%. Both will be firmed during the
day.
Deutsche Bank AG, Goldman Sachs and JP Morgan are the banks
managing the bond issue.
Hybrid bonds combine aspects of both debt and equity, and in the
event of a default pay-out after more traditional corporate bonds.
Investors are paid for this higher level of risk.
The issuer is rated Baa2 by Moody's Investors Service Inc., BBB-
by Standard and Poor's Corp. and BBB- by Fitch Ratings.
Write to Serena Ruffoni at serena.ruffoni@dowjones.com