Ryanair Holdings Plc is planning its first bond sale after corporate borrowing costs fell to a record in Europe and the Irish company was awarded credit ratings that make it the highest-ranked carrier in the world.
Europe’s No. 1 discount airline has hired banks to arrange investor meetings starting June 3 to market a possible sale of notes in euros, according to a person familiar with the matter. It was graded BBB+ by Fitch Ratings this month, three levels above junk, the same rank awarded by Standard & Poor’s in April.
Ryanair is refining its no frills model with customer-friendly enhancements such as allocated seating and an improved website as it seeks to lift passengers numbers by more than one- third to 110 million by 2019. The Dublin-based airline agreed to buy five more Boeing Co. 737-800s last month, bringing its total order book to 180 jets worth $16 billion at current list prices.
“We have our first deliveries coming in September, so we’re looking to do a bond,” Chief Financial Officer Howard Millar said on May 19, adding that the value would be at least 500 million euros ($681 million), with a seven-year term.
The average yield on investment-grade bonds in euros fell 18 basis points this month to an all-time low of 1.6 percent, according to Bank of America Merrill Lynch index data.
To contact the reporters on this story: Kari Lundgren in London at [email protected]; Jennifer Joan Lee in London at [email protected] To contact the editors responsible for this story: Benedikt Kammel at [email protected]