BellSouth Corp is again testing faith in its longevity with another century debt issue but the two-part deal has an unusual structure. It is offering $500m of zero to full coupon debentures, which will pay no interest for the first 20 years, and will then start paying 6.65%; to compensate for forgoing interest for the first 20 years, investors get the prospect of a big capital gain over the years provided interest rates are not stratospheric 20 years from now: the things are priced at only $25.235%, raising $126m for BellSouth. The debentures mature December 15 2095. The other part of the deal is a $375m issue of amortising notes due December 15 2015. Salomon Brothers Inc is handling the deal.
LG Group Ltd, the former Lucky Goldstar of Seoul, South Korea sent its LG Semicon to the Eurobond market: the congolerate’s chipmaking arm plans to raise $100m with an issue of five-year Eurobonds, to be available only in $500,000 denominations.
