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It was the typical deal where there is a split between how well the domestic investors know the credit and how little international investors know it.
In France everyone knows Schneider Electric. The company belongs to the aristocracy of the French equity world. The stock is a constituent of the CAC40, the main index on the Paris stock exchange. Thus, when it decided to issue a five-year €750 million ($765 million) Eurobond on March 19, there was no doubt that French investors would snap up the paper.
The situation was different abroad where the company is almost unknown to bond investors. However, some equity investors were aware of the value of the company, which is a worldwide leader in electrical components and equipment. "The fact is that the man in the street doesn't know these sectors," claims Guillaume Redaud, syndicate manager at the London headquarters of Paribas, which led the deal alongside Morgan Stanley Dean Witter.