BayernLB acted as joint lead manager and active bookrunner to place a benchmark bond for Deutsche Bahn with a maturity of 30 years and a final volume of EUR 1,000 million. The international syndicate also included Citigroup, Raiffeisen Bank International and UniCredit.
With this long maturity, Deutsche Bahn is considerably expanding its previous maturity profile.
This very successful transaction was not only Deutsche Bahn’s first 30-year bond, but it also has the lowest coupon of a 30-year EUR corporate benchmark issue at 0.625 percent. The bond therefore enjoyed very strong demand on the market and was placed mainly with institutional investors in Europe.
This issue improves the company’s financial flexibility and supports the mobility group’s overarching “Strong Rail” (“Starke Schiene”) strategy. The essential goal of this strategy is to get more traffic on the rails and work towards the German government’s key transport and climate-policy goals. This includes extending lines and providing more trains, more frequent services and greater connectivity, as well as better services for freight transport.
It is the second time in a year that Deutsche Bahn has mandated BayernLB for a bond transaction. In February, BayernLB placed a bond of EUR 300 million with a maturity of four years for Deutsche Bahn. “This further proof of their confidence in us,” commented Michael Bücker, Board of Management member responsible for corporate banking at BayernLB, “underscores our in-depth sector expertise in the future-oriented mobility sector, as well as our recognised structuring and capital market know-how”.
Christian Große Erdmann, Head of Capital Markets & Risk Management at Deutsche Bahn AG, summarised: “Banking is a team sport. It transcends department boundaries. BayernLB supports Deutsche Bahn, for example with cash credit facilities, in the German and international guarantee business and with high-volume bond issues. The 30-year EUR 1 billion St. Nicholas bond was not only the longest benchmark bond issued by Deutsche Bahn, it also achieved the lowest issue yield ever achieved by a company for a comparable bond. BayernLB led this transaction as joint bookrunner and sole documentation agent.”