French telecommunications company Orange S.A. has announced its intention to issue a new series of euro-denominated hybrid notes as part of a broader strategy to actively manage and optimize its hybrid debt portfolio. The planned securities will take the form of undated, deeply subordinated fixed-to-reset rate notes with a seven-year non-call period. The company expects the new notes to be listed on Euronext Paris and anticipates receiving investment-grade ratings from major credit rating agencies.
Alongside the proposed issuance, Orange has launched a tender offer aimed at repurchasing portions of two existing series of hybrid notes currently outstanding in the market. These notes include securities with first reset dates scheduled in 2026 and 2027. Through the tender offer, the company intends to buy back all eligible outstanding notes from the 2026 series and a portion or all of the 2027 series, depending on participation levels and the size of the new issuance.
The transaction forms part of Orange’s ongoing capital management strategy. By issuing new hybrid securities while repurchasing older instruments approaching their reset dates, the company seeks to maintain flexibility in its financing structure and manage future refinancing requirements. The initiative also allows existing noteholders to liquidate their investments before upcoming reset periods while potentially obtaining priority consideration in the allocation of the newly issued notes.
Hybrid notes occupy a unique position between debt and equity within a company’s capital structure. Because of their deeply subordinated nature and perpetual characteristics, rating agencies often assign partial equity treatment to such instruments. Orange expects the new notes to receive 50% equity credit, which can support balance-sheet strength and help maintain favorable credit metrics.
The tender offer is scheduled to remain open until 22 June 2026, with the results expected to be announced on 23 June 2026, subject to any modifications or extensions. The maximum amount of existing notes repurchased will generally correspond to the principal amount raised through the new hybrid notes issuance, adjusted for outstanding amounts of certain existing securities.
The company emphasized that the transaction is intended primarily for qualified investors and is subject to regulatory restrictions in various jurisdictions. The offering and tender process are not being conducted in the United States, and the securities have not been registered under U.S. securities laws. Similar restrictions apply in several other international markets where local regulations govern securities offerings and debt repurchase transactions.
The planned issuance reflects a broader trend among large European corporations using hybrid bonds as a financing tool to balance funding needs, preserve credit ratings, and strengthen financial flexibility. For Orange, the transaction represents a proactive effort to manage its long-term capital structure while maintaining access to diverse sources of financing in the European debt markets.
If successfully completed, the issuance of new hybrid notes and the repurchase of existing securities will help streamline Orange’s hybrid debt portfolio, extend financing horizons, and support the company’s broader financial and strategic objectives in the years ahead.
