UVA Yet to Pull Trigger

Usina Vista Alegre (UVA) has yet to pull the trigger against what remains an uncertain market backdrop and one in which several investors were unwilling to take a bet on the single B Brazilian sugar and ethanol producer. Whether UVA will move ahead this week remained unclear late Monday, but in the current market environment few thought that it would try pricing any time soon. With the deadline to lift the US debt ceiling looming, most bankers agree that issuers are likely to wait until after Republicans and Democrats reach some sort of resolution on US Treasury payments. “It is going to come down to the wire. Late this week they will probably have something to agree on,” says a banker. “Unless something drastic happens, a positive agreement [over the US debt ceiling] may lend itself to some opportunistic issues.” Still, Mexican retail Grupo Elektra continues to move forward with its 7-year NC4, while utilities AES Gener and Transener are also carrying out their own liability management transactions. This comes as UVA left some investors voicing concerns about its 5.3x debt to Ebitdar ratio and tight liquidity after it released price talk in the 11% area. With investors seeking safety in liquidity, the $150m-$200m or smaller size certainly did not help on what is a sole lead transaction. The sugarcane grower and ethanol producer is rated B minus/B3 and is coming to market through BTG Pactual.