The award for Large Treasury Team of the Year went to the team at Heathrow, following a standout year, which saw the team navigate business transformation while executing an ambitious range of capital markets activity.
Among the team’s achievements were multiple funding transactions, including a long-dated EUR benchmark in the public market, a privately placed EUR zero-coupon medium-term note, investor diversification into the CHF public market and forward-starting GBP bonds.
Heathrow also raised £300m of sub-investment-grade holding company bonds, pushing the tenor out to 10 years at a coupon of just 4.125%, as well as completing numerous private placements.
All this would have been enough for some treasury teams, but Heathrow also carried out a complex and challenging liability management exercise, in the form of a £13bn Consent Solicitation to amend documentation and covenant calculations in light of IFRS 16. The exercise covered 35 public notes, as well as private debt, in both investment-grade and sub-investment-grade formats.
Notably, the outcome of the Consent Solicitation saw the inclusion of certain operating leases in net debt. While the financing documentation contained provisions that may have allowed Heathrow to mitigate the change, the company illustrated a commitment to transparency and fairness by engaging with stakeholders early and ensuring a balanced and fair outcome for all parties.
The exercise involved months of effort, with the team working with shareholders to demonstrate the value of undertaking the exercise for future capital markets relationships, as well as working with bank lenders to maintain financial flexibility throughout the process. And of course, business as usual had to be maintained throughout the process, with the team continuing to execute on capital markets plans.
Compounding the challenge, all this activity took place against the backdrop of business transformation in light of the airport’s expansion plans. What’s more, Sally Ding stepped up as director of treasury and corporate finance, and managed multiple changes to the team – a process that involved working with secondees and interims while recruiting a permanent team.
In this category, the most impressive teams tend to be those that have not only demonstrated operational transformation or transactional excellence, but have also focused on continual improvement and the nuts and bolts of treasury activities – whether that means reviewing risk management processes or implementing a new treasury management system.
As such, the judges commended the multifaceted nature of Heathrow treasury’s achievements, from the wide range of transactions completed to the way the team has overcome challenges, embraced collaboration and grown over time.
“Heathrow treasury has a strong track record when it comes to moving people up, and this submission demonstrated a clear focus on continuous improvement and development within the team.”
This article was taken from the October/November 2020 issue of The Treasurer magazine.