Bloomberg News

Areva Sells First Bonds Since Fukushima Nuclear Disaster

September 28, 2011

(Updates to show sale completed in first paragraph.)

Sept. 28 (Bloomberg) -- Areva SA, the world’s largest builder of nuclear plants, sold its first bonds since the Fukushima disaster in Japan made some nations rethink their reliance on atomic energy.

The utility issued 500 million euros ($680 million) of six- year 4.625 percent notes, according to data compiled by Bloomberg. The company last sold bonds in September 2010 when it issued 750 million euros of 3.5 percent notes due in 2021, the data show.

Areva’s BBB+ rating outlook was cut to negative in August by Standard & Poor’s, which cited “increased uncertainties surrounding the nuclear industry.” The company lowered its outlook for nuclear plant orders through 2030 in the wake of Japan’s nuclear disaster in March, Chief Executive Officer Luc Oursel told Les Echos newspaper earlier this month.

Areva’s new notes were priced to yield 255 basis points more than the benchmark swap rate, or 4.7 percent, Bloomberg data show. That compares with 3.6 percent for Bank of America Merrill Lynch’s EUR Corporates Utilities index, which tracks 200 securities issued by companies including Electricite de France SA and Enel SpA.

The yield on Areva’s 2021 notes rose 30 basis points to 5.23 percent today, the highest since April, according to Bloomberg Bond Trader prices. The yield touched a post-Fukushima low of 4.48 percent in August.

BNP Paribas SA, JPMorgan Chase & Co., Banco Santander SA and Societe Generale SA managed the sale of the new bonds, two people with knowledge of the transaction said today.

Areva shares have fallen 38 percent this year. The company is 83 percent-owned by the French government, Bloomberg data show.

--Editors: Andrew Reierson, Michael Shanahan

To contact the reporter on this story: Ben Martin in London at bmartin38@bloomberg.net

To contact the editor responsible for this story: Paul Armstrong at Parmstrong10@bloomberg.net


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