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The Morning Ledger: U.S. Companies Flood Into European Debt Market
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Coca-Cola issued a round of eurobonds worth €3.5 billion. PHOTO: ULRICH PERREY/DPA/GETTY IMAGES
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Hello. Finance chiefs are often tasked not only with capital allocation, but the best place to source that capital. Lately that’s been Europe, The Wall Street Journal’s Avantika Chilkoti reports. As corporate borrowers returned in force to the bond market following one of the weakest stretches in years, Europe’s debt market is on a particularly strong run.
Everybody loves the Yankees. U.S. companies have ramped up issuance of euro-denominated bonds, known as “reverse Yankees,” to a total of €28.46 billion ($32.31 billion) so far this year, according to data firm Dealogic, compared with €6.71 billion in the same period of 2018. Large deals include a €3.5 billion round of bonds issued by Coca-Cola Co., and €1 billion from toothpaste maker Colgate-Palmolive Co.
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Lower costs. European benchmark rates are still negative and nearly 3 percentage points lower than in the U.S., making that market more appealing. And while hedging costs were elevated last year, those costs have fallen more recently, as seen in derivatives known as cross-currency basis swaps.
Tax law impact. The U.S. tax law overhaul, passed in late 2017, has encouraged U.S. companies to repatriate more of their foreign profits. This, in turn, is increasing the need to issue debt abroad to fund local operations.
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The Federal Reserve Bank of Philadelphia is scheduled to release its index of manufacturing activity at 8:30 a.m. ET. Economists surveyed by The Wall Street Journal expect that factory activity in the mid-Atlantic picked up to 5.0 in March from -4.1 in February.
Darden Restaurants Inc., Conagra Brands Inc. and Nike Inc. are among the companies scheduled to report earnings later today.
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Levi Strauss is returning to the public markets at a time of intense scrutiny for retail and apparel brands. PHOTO: DAVID PAUL MORRIS/BLOOMBERG NEWS
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Levi Strauss & Co. is set to go public for the second time Thursday as the jeans maker jumps on an IPO wave being ridden most notably by big tech startups such as Lyft Inc. and Uber Technologies Inc.
Bayer AG shares dropped more than 9.6% Wednesday—the biggest single-day percentage decline in seven months—after the chemicals and pharmaceuticals giant faced another legal setback in its fight against accusations that its Roundup weedkiller causes cancer.
General Mills Inc. boosted profit with higher prices, but sales slipped in the latest quarter for the maker of Cheerios cereal and Yoplait yogurt.
Ford Motor Co. is increasing its bet on electric cars, saying Wednesday it will convert a second North American plant to build plug-in models even as demand for the technology remains weak in the U.S.
UBS Group AG Chief Executive Sergio Ermotti on Wednesday warned of a weak start to the year for the bank’s investment-banking and wealth-management units, citing “one of the worst first quarter environments in recent history.”
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Prime Minister Theresa May leaves 10 Downing St. to attend the weekly prime minister’s questions session in Parliament in London on Wednesday. PHOTO: MATT DUNHAM/ASSOCIATED PRESS
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The U.K. asked the European Union to delay its departure from the bloc until June 30, an extension that if approved would give Prime Minister Theresa May just weeks to break an impasse in Parliament over her withdrawal deal.
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A Lithuanian man pleaded guilty to his role in a complex wire fraud scheme that resulted in the theft of more than $100 million from Alphabet Inc.’s Google and Facebook Inc., prosecutors said Wednesday.
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India’s onetime jeweler to the stars, Nirav Modi, has been arrested in London and faces extradition to India to face allegations that he defrauded lenders of nearly $2 billion.
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The Defense Department Office of Inspector General had begun an investigation into whether acting U.S. Defense Secretary Pat Shanahan sought preferential treatment for his longtime former employer, Boeing Co., while serving in government.
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Financial-services firms from the EU have only a week to sign up with British regulators to continue operating in the U.K. in case of a no-deal Brexit, a regulator warned on Thursday, as reported by Reuters.
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President Trump on Wednesday spoke to reporters before a trip to Ohio. PHOTO: MANUEL BALCE CENETA/ASSOCIATED PRESS
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President Trump said Wednesday that his administration was discussing leaving in place tariffs on Chinese goods for a “substantial period of time.”
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U.S. government bonds rallied Wednesday after the Fed meeting, sending the 10-year Treasury yield tumbling to its lowest level in more than a year.
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High-end U.S. home buyers are turning cautious, a blow to banks that refocused their mortgage businesses around wealthy borrowers in the years after the financial crisis.
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One of the biggest importers of toilet paper in the U.K.—Germany's Wepa Hygieneprodukte GmbH—has been stockpiling supplies to prepare for a potential a no-deal Brexit, the BBC reports.
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Perrigo Co., the Dublin, Ireland,-based health-care company, named Ray Silcock as chief financial officer and principal accounting officer, effective March 25.
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He succeeds Ronald Winowiecki, who resigned effective that date. Mr. Winowiecki will remain with Perrigo in an advisory capacity through June 30 to ensure a smooth transition.
Mr. Silcock was most recently CFO at INW Holdings, from August 2018 to March 2019. Before that, he was vice president and CFO at CTI Foods, from June 2016 to July 2018, and was CFO of Diamond Foods Inc. from June 2013 to March 2016.
Mr. Silcock’s compensation includes a base salary of $650,000, a sign-on bonus of $500,000, a performance-linked bonus targeted at 80% of his base salary and an annual equity grant of both performance-based and service-based restricted stock units with a target value of $2 million, according to a regulatory filing.
Mr. Winowiecki’s total 2018 compensation was valued at $3.4 million and included a base salary of $621,875, cash bonuses totaling $573,500, equity awards valued at $2.1 million and other compensation of $39,520, according to the company’s proxy filing.
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