Elis : Issuance Focus
Elis is looking to return to the bond market to refinance the last part of its acquisition loan (around € 1bn). The group plans to place two tranches, a benchmark-size five-year tranche (February 2023) and an eight-year tranche of € 300m (February 2026).We are adopting a Positive Credit Opinion on the issuer. Elis appears to be a strong "BB" issuer, enjoying a fairly resilient business model thanks to management’s prudent financial strategy (respect of a given debt ratio target, growth strategy via targeted acquisitions and shareholders’ contribution when financing larger deals). Additionally, if the consolidation of Berendsen goes as expected, an upgrade to the rating from BB to BB+ by S&P seems to be likely in a year's time.This new bond placement should therefore be a good opportunity to take positions on Elis.The price-talk of the five-year tranche is announced at around "2.25%", while that of the eight-year is "3.0% to 3.125%".We recommend subscribing to the issue, with a preference for the 2023 bonds, given the yield on peers is about 2% for the five-year maturity (about 160bp) and about 3.0% for eight-year maturity (about 200bp).Note that Elis has two other outstanding bond issues: - the 3.0% 2022 bond, callable from April and priced in in the event of redemption in the short term, which we recommend to hold (Neutral recommendation) - the 0% 2023 convertible bond. See our recommendation below. >Axcelis Technologies designs, manufactures and services ion implantation and other processing equipment used in the fabrication of semiconductor chips. The company also provides aftermarket lifecycle products and services, including used tools, spare parts, equipment upgrades, maintenance services and customer training. The company provides high energy, high current and medium current implanters for all application requirements. The company's Purion systems are all based on a common platform which enables a combination of implant purity, precision and productivity by combining a single wafer end station, with a spot beam architecture. The company's other products include curing systems, and thermal processing systems.
Oddo Securities provides securities brokerage and research services. The company offers equity, economic, and derivatives research and credit analysis services. It focuses on insurance, automotive, building materials, pharmaceuticals, telecommunications, information technology, and agri-food industries.
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