British telecommunications giant BT was expected to break the record for corporate bond issues on Tuesday by increasing the size of a security issue to 10 billion dollars (11.3 billion euros), the Financial Times reported.
British Telecom, wheezing under a heavy debt burden rapidly nearing 30 billion pounds (50 billion euros, 42.6 billion dollars), had already unveiled plans to drum up between six and eight billion dollars from a bond issue to buy itself some financial breathing space.
The FT said the company was now looking to increase this to 10 billion dollars, marking a record corporate bond offer. But in a sign of market concern at the telecom heavyweight's balance sheet, BT would have to pay hefty rates of interest on its bonds in order to secure placement.
The FT said the likely prevailing rates would be range from 225 to 300 basis points above the yield on US treasury paper.
BT has become bogged down this year by oppressive debts incurred during the financing of mobile telephone assets and third-generation licenses.
Executives last month announced a partial break-up of the company, with four operations due to be spun off and partially floated to drum up billions of pounds to ease the debt worry.
Investors scurried back into BT stock on Tuesday after months of heavy selling that has more than halved the company's share price this year. BT stock was quoted at 638.5 pence, up two percent -- LONDON (AFP)
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