Gatwick sells junk-rated bond as Covid threatens summer travel

One of Europe’s busiest airports is hitting the bond market on Monday to shore up its finances in the face of a second tourist season lost to the coronavirus pandemic. London’s Gatwick Airport is marketing GBP400m of junk-rated debt with a five-year maturity. But with British holiday makers still forbidden from traveling, it’s offering a hefty premium to lure skeptical investors -- a yield between 4.75% and 5% which is more than double the average for European bonds with a similar credit rating. Representatives for Gatwick didn’t immediately respond to a request for comment on the offering. Gatwick’s passenger numbers will this year only rebound to around 40% of 2019 levels, Standard & Poor’s Global Ratings said in a note on Monday. But while there’s little prospect of respite for the travel industry, Gatwick is selling into a booming junk bond market. High-yield debt sales are running at the fastest pace on record this year as investors scour for returns in a world of rock-bottom interest rates.<br/>