Saint-Gobain: two-part euro bond

France“s Saint-Gobain, the world“s largest listed building materials company, plans to sell a two-part, benchmark-sized euro bond to refinance bank debt backing its purchase of Britain“s BPB and to…

France“s Saint-Gobain, the world“s largest listed building materials company, plans to sell a two-part, benchmark-sized euro bond to refinance bank debt backing its purchase of Britain“s BPB and to fund general corporate purposes, a company official said on 3 May 2006. Saint-Gobain acquired British plasterboard maker BPB in 2005 for GBP 3.9 billion (USD 7.2 billion) in cash, and took out a EUR 9-billion (USD 11.4 billion) loan to pay for the takeover. The deal is expected to be made up of 5- and 10-year bonds, an official at one of the banks managing the sale said, and will conclude after an investor roadshow from 11 to 15 May 2006. Benchmark bonds total at least EUR 500 million. The company official did not give a size for the bond. BNP Paribas, Calyon, Deutsche Bank and JP Morgan are managing the bond sale. Saint-Gobain is rated Baa1 by Moody“s Investors Service and BBB+ by Standard & Poor“s, both on the third-lowest level of investment grade. S&P changed its outlook on the company“s rating to negative in December 2005, saying there were uncertainties about the group“s ability to improve its financial profile after the acquisition of BPB. Moody“s has a stable outlook on its rating.