Braskem Lands Breakthrough Securitization

Petrochemicals giant Braskem has raised a BRL250m securitization in Brazil, cracking open a market for structured corporate risk that has been dormant for the better part of a year. The company’s Chemical IV FIDC, which carries a tenor of 18 months, had sought to launch last year, but pricing levels did not appeal to Braskem, which opted to wait, rework, and return to investors in May. A BRL227m senior tranche priced at CDI plus 140bp, says an investor on the transaction, well below the stated maximum of 300bp. Pricing is roughly in line with what some higher-rated 2-year debentures have been coming at, says a structured finance expert eyeing local flow. An BRL18m mezzanine piece came at CDI plus 750bp, top of the targeted range, adds the buysider. Books were heavily oversubscribed as asset managers, hedge funds, and – in the case of the senior AAA tranche – pension funds and insurance companies sought participation, say executives involved in the transaction. The securities are backed by supplier receivables for already delivered goods and services. Banco do Brasil (BdB) distributed the senior portion, while UBS Pactual worked on the junior tranche. BdB also placed in early June a BRL150 million 26-month securitization at CDI plus 230bp for one of its own subsidiaries, Cobra. The deal is backed by service contracts the bank has with the issuer of record Cobra, a wholly owned subsidiary. Investors expressed strong appetite for the AAA deal, says a banker at BdB. He adds that the state-owned bank plans other similar deals in the immediate future.