At least five top European companies are set to buy back some of their debt in the coming months as the trend to reduce costs and lengthen bond maturities gathers pace.

Credit analysts at Dresdner Kleinwort Wasserstein, the investment banking arm of Germany's Dresdner Bank, predicted in a research note that VNU, the Dutch media group, France Télécom, Telecom Italia and Rheinmetall, the German defences and autos business, were likely to pursue debt buy backs.