Santander Corporate & Investment | The launch of the MSCI ESG Screened Europe iTraxx Index, based on the MSCI iTraxx Europe Series 33 Index and the application of three MSCI filters, took place with great fanfare on June 21. Enel and Iberdrola have AAA ratings from MSCI for their ESG (environmental, social and governance) characteristics, but they have presumably been excluded from the index because of their involvement in nuclear and coal-fired energy production.
The main reasons for the downgrade are the economic deterioration in the regions where the bank is present, especially Mexico and Spain. However, it also flags that even after losing a rating notch, BBVA has sufficient financial cushion, geographical diversification and a good competitive position in its reference markets to avoid being affected by new downward revisions in the short term.
Through one of its subsidiaries, Siemens Gamesa has received a conditional order from Innogy SE for the supply of 100 units of the SG 14-222 DD offshore wind turbine. The order, with a total potential of 1.4 GW, is for the Sofia wind farm, located 195 km off the UK’s northeast coast. The deal also includes a service and maintenance contract. The order represents 4.9% of Siemens Gamesa’s portfolio at end-March.
Moody’s has warned that over half of Spain’s non-financial companies rated by the credit agency are at risk of being downgraded in the next 18 months. This is in light of the prospect that their solvency will continue to weaken, even after the government relaxes restrictions on mobility and travel and eases social distancing. In fact, the ratings agency highlights that between March and May 2020, it took 29 negative actions on the ratings of Spanish non-financial companies.
Adam Vettese (eToro) | Bitcoin is not the top cryptoasset, according to a new Chinese report that ranked global cryptoassets based on their technical merits. According to a report from China’s Centre for Information and Industry Development (CCID) Bitcoin, the world’s oldest and largest crypto asset by market cap, ranked 12th.
Prointec, Indra’s civil engineering subsidiary, will participate in the largest railway infrastructure project in Europe, Rail Baltica. This is a rail network for passengers and goods linking the Baltic countries, Estonia, Latvia and Lithuania to the Trans-European Transport Network (TEN-t). In consortium with German engineering consultancy Obermeyer Planen + Beraten GmbH, it will design a 93.5 km section of the works for a total of €10.8 M.
Mona Mahajan (Allianz GI) | With equities rallying more than 30% since late March, driven most recently by cyclicals, financial markets were perhaps due for a period of consolidation. New risks could emerge, but we continue to believe in the ongoing economic re-opening story — so cyclical sectors may remain market leaders in the near term. Markets could be supported further as elevated levels of cash are put back to work.
This figure is the result of a corporate reorganization undertaken by the lender in recent months. The bank bought 25% of the capital of Santander Consumer Finance which it did not control directly from one of its subsidiaries. This stake has been valued at 3.193 billion euros which means valuing 100% of the subsidiary at nearly 12.8 billion.
Yves Bonzon (Julius Baer) | The global equity market has seen a multi-percent- age correction for a variety of reasons, from re- newed fears of a second wave of coronavirus infec- tions to disappointment about Federal Reserve (Fed) Chairman Jerome Powell’s policy stance. In the wake of a rally of almost 50% from the lows of March, it is fair to say that such a decline cannot come as a surprise.
Renta 4 | Iberdrola has announced a takeover bid for 100% of the Australian renewables company Infigen Energy at a price of AUD 0.86$ per share. This is in line with Infigen Energy’s current stock price, but 6% higher than the offer made by UAL Energy on 9 June. It values Infigen at AUD 841 M (510 million euros approximately, 0.7% of Iberdrola’s market cap), with an EV/EBITDA multiple of 8.2x (vs 10x at Iberdrola’s current price).