Volvo Cars planning €500m (Rs 34,129.9 crore) bond issue

Volvo Cars, the premium car maker, has announced it is seeking to raise Euros 500m (Rs 3798 crore) from a bond issue, its first foray into the global corporate bond markets in its 89 year history. The Swedish company will begin a road show for potential investors on May 9, 2016.

Volvo Cars has secured corporate credit ratings from Standard & Poor’s (S&P) of BB with a positive outlook.

S&P said in its analysis: “The Company’s business risk profile is supported by a well-established market position as a mid-sized car manufacturer, being active in Western Europe, Asia, and North America, helped by a track record of safety, reliability, innovation, and technological expertise.

 “We expect Volvo's strategy will enable the company to benefit from stronger market demand, higher pricing and wider profit margins, which will improve its competitive position. We also envisage that the transition to more flexible and cost-efficient manufacturing platforms, which is currently underway, will support profitability and product quality.”