ICAP Notes rated investment grade BBB/Baa2 by S&P/Moody’s, yield 3.2%
One of the leading global electronic brokers, ICAP (LON:IAP), is about to issue €325 million ($481 million) of five-year notes related to its latest refinancing operation. The Euro denominated 5-year notes will be listed on the London Stock Exchange on the 6th of March with the company aiming to refinance its obligations for fiscal 2015 that amount to £301 million ($502 million) of debt as of September 30th 2013.
The interest rate on the notes is indicated at 3.2% with the issue being part of the £1 billion Global Medium Term Note Programme of ICAP plc and ICAP Group Holdings. Rating agencies have stamped the notes with a Baa2 rating with a negative outlook by Moody’s and BBB with a stable outlook by Fitch. ICAP has been losing revenues lately, as the company is getting accustomed to the revamped regulatory environment in the US and the expected changes under MiFID II.
Profits have been dropping at ICAP for the past year as volumes on the company’s EBS platform have dwindled through the past couple of years to end up being a fraction of what they used to be in the beginning of 2011. Steady growth by competitors from FXall and its parent company Thomson Reuters have compounded existing legacy regulatory problems.
Back in September 2013 ICAP has settled with UK’s FCA for £14 million and the US CFTC for $65 million due to the company’s involvement in an attempted manipulation of Yen LIBOR rates between 2006 and 2011. Former employees of the company have been criminally charged by the US Department of Justice, however a conclusion is still imminent with the possible outcome of criminally charging ICAP Europe still remaining in the balance.