A report by Standard & Poor's telecoms sector faces the greatest refinancing needs of any non-financial corporate sector over the next three years, as US$2,100 billion (€1,649 billion) of European corporate debt is set to mature.
Some US$206 billion (€161.8 billion) of debt is coming due over the fourth quarter of 2008 alone.
The report, cited in the Financial Times adds, "These companies face the combined difficulty of needing to refinance debt as banks want to lend less, the cost of funding has increased and the investor base has shrunk. While some companies have tried to be proactive - refinancing debt when opportunities arise - market conditions have been so difficult and volatile recently that it has left many waiting."
In general, European companies have done less refinancing than those in the US, partly because they have always relied more heavily on the bank market
S&P highlights the soaring cost of capital, with companies having to pay 10 times the spread levels on bank debt in euro they were able to secure in August 2007.
The FT points out that the study is based on volume of debt the agency rates but it does not factor in funding that companies may have already done in advance of this debt maturing. Also, not all maturing debt will need to be refinanced.