SES - comment

Following its merger with Intelsat, the Luxembourg satellite operator is tendering for its outstanding subordinated perps, funded with a new subordinated hybrid on offer, structured to receive all-equity treatment by both Moody’s and Fitch. Coupon is guided to come in a little lower than the old instrument at 5.25% and at first glance sound like CoCo bonds, including a convertible element for “Conversion Beneficiary Units” (CBUs) in “under certain stress events". In light of the global LEO race, SES’s future is a tad less certain than that of Eutelsat, for instance, but the general tide of satellite data, communication, and defence in space should lift all boats sufficiently, but it’s not our type of deal.