Ryanair eyes euro bond to pare debt-repayment risks

SINGAPORE • Ryanair Holdings plc is readying its first euro-bond sale since 2017, testing investor appetite for high-grade airline debt amid coronavirus travel upheavals.

Europe’s biggest discount carrier was scheduled to speak to investors yesterday about a potential five-year bond of at least €500 million (RM2.5 billion), according to a person familiar with the matter, who asked not to be named as they aren’t authorised to speak publicly. CFO Neil Sorahan was to lead the call.

The Irish carrier recently signalled plans for a bond sale as it seeks to pare debt-repayment risks over the next 12 months, as well as positioning itself to potentially profit from the shrinkage or failure of rivals due to virus travel disruptions. The airline, which sold €400 million of new stock last week, has held onto investment-grade ratings during the virus turmoil in contrast to competitors, such as Deutsche Lufthansa AG and British Airways parent IAG.

Ryanair has €2.45 billion of bonds outstanding, including an €850 million note coming due in June, according to data compiled by Bloomberg. The carrier is rated BBB, two steps above junk, at both S&P Global Ratings and Fitch Ratings Ltd.

Finnair Oyj is the only carrier to have visited Europe’s primary debt market since the Covid-19 outbreak forced airlines worldwide to ground planes and cut services. It paid 10.25% on a euro hybrid note last month.

A Ryanair spokesperson declined to comment when contacted by Bloomberg News via email.

The carrier said last week that the “enhanced liquidity” from the share placement will “likely optimise” the bond sale. — Bloomberg