The European pipeline continued to look relatively busy last week, though there was a notable pause from the gigantic billion-dollar deals seen over the past weeks. This, however, has made some room for smaller scaled issuers to head into the pipeline before the anticipated August slowdown.
According to the industry reports, the market last week saw at least 14 new deals added to the agenda. Joining the list is the GBP180 million (US$289.6 million) Harbour Funding securitization of housing association loans. Investors are being offered a single tranche rated double-A minus.
Also on tap is a deal from the pub sector, Spirit Funding Ltd. The transaction is structured in several parts: GBP66 million (US$106.2 million) in triple-A notes and GBP25 million (US$40.2 million) in triple-B notes (N-class). An additional GBP41.5 million (US$66.7 million) triple-B minus class P will be added to the capital structure, which will pay down an existing class O tranche. Guidance for the A-class was 40 basis points over Libor, while the N-class was talked at the 280 area. The proceeds are expected to fund Spirit's acquisition of 75 pubs under the Tom Cobleigh Estate, bringing the portfolio of holdings up to 1,072 pubs, reported sources at Royal Bank of Scotland.
Adding some visible fluff to Portuguese volumes was a succession of paper that priced last week. Among the names included was the Aqua Finance Ltd transaction, which priced its triple-A rated, E158 million (US$178.2 million) class A note in line with talk at 30 over the three-month Euribor. The class B notes priced at 55 basis points and a class C tranche priced at 85 basis points. The E175 million (US$197 million) transaction issued by Finicredito was backed by 35,720 contracts - 85% came from autos, 14% from consumer durables and 1% from equipment contracts.
A second E400 million (US$449.2 million) transaction for the Portuguese rail infrastructure company, Polo Securities III, priced its 10-year triple A notes at 43 basis points at mid swaps and its 12-year triple A notes at 47 basis points. The state-owned company opted for a monoline wrap to achieve its triple-A rating rather than employing a state-supported guarantee, a trend that is monoline's say is thriving in the current market environment. On the RMBS side, the Portuguese-based billion-dollar deal Hippottota added some hefty weight to volumes.
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