Wind Telecomunicazioni SpA will begin marketing 3.75 billion euros ($5.1 billion) of bonds today in the largest high-yield sale globally since T-Mobile US Inc.’s $5.6 billion issue in October.
Italy’s third-biggest mobile operator wants to sell about 1.85 billion euros and $2.6 billion of seven-year notes through its Wind Acquisition Finance SA unit, according to a person familiar with the matter, who asked not to be identified because the matter is private.
Wind owner VimpelCom Ltd. is seeking to issue the notes as part of a refinancing plan to save the Rome-based company 200 million euros a year. The average yield on junk-rated corporate bonds in euros fell to a record 4.38 percent, according to Bank of America Merrill Lynch’s Euro High Yield Constrained Index.
Artem Minaev, an Amsterdam-based spokesman for VimpelCom, declined to comment on the bond sale. Representatives of Wind didn’t respond to a telephone call and e-mail seeking comment.
Wind’s new notes will refinance its 11.75 percent securities and 12.25 percent payment-in-kind debt, both due July 2017, the person said. Lenders to the company agreed last month to extend its loans as part of the plan that also includes 500 million euros of capital from VimpelCom.
T-Mobile, which is majority-owned by Deutsche Telekom AG, sold bonds in five parts on October 8.
Wind is rated B1 by Moody’s Investors Service, four levels below investment grade, and had total borrowings of 10.4 billion euros at the end of 2013, according to data compiled by Bloomberg. Its ratio of net debt to earnings before interest, tax, depreciation and amortization was 5.4 times.