White & Case LLP has advised Citigroup, as Structuring Adviser, Barclays as Joint Global Coordinator and HSBC and Société Générale as Joint Bookrunners, on the issuance by Total S.A. of its two-tranche €5 billion undated deeply subordinated notes, the largest euro-denominated corporate hybrid bond issue to date.

The two tranches, with an aggregate principal amount of €2.5 billion each, contain call options after six years and ten years, respectively. The six-year non-call tranche pays an annual coupon of 2.25 percent and the ten-year non-call tranche pays an annual coupon of 2.625 percent, each resettable periodically after the first call dates.

The securities will rank junior to all senior debt and, in accordance with IFRS, will be recognized as 100 percent equity. They will be assigned 50 percent ‘intermediate’ equity content by S&P and Moody’s rating agencies.

The bonds, issued on February 26, 2015, are listed on the regulated market of Euronext Paris. The issue attracted a diverse international investor base and was significantly oversubscribed with an order book of nearly €20 billion. The deal is notable as the biggest in euros as well as the highest rated hybrid bond of its kind ever issued, and the coupons are the lowest on record for comparable deals.

The White & Case team in Paris which advised on the transaction was led by partners Cenzi Gargaro and Philippe Herbelin with support from associates Grégoire Karila and Isabelle Touré-Farah. Partner Alexandre Ippolito, with support from associate Marcus Schmidbauer, advised on tax matters.