A big deal (TT JulAug08 p20-21)

In July 2007, GlaxoSmithKline announced a £12bn share buyback programme, to be completed over a two-year period. This was to be financed with debt and consequently alter the capital structure of the company. At the time, Glaxo was rated Aa2/AA and was one of the few AA corporates worldwide.

There are arguments, more vociferous in the last 12 months, that to guarantee debt market access, the higher the rating the better. But pragmatically speaking, anything rated A or better should be assured of good access in all but the very worst markets.