BNDESPar has agreed to buy a BRL600m ($294m) stake in of GraalBio, a Brazilian biotechnology firm, it says. The investment arm of the BNDES development bank gets shares worth 15% of the company, which specializes in second-generation ethanol and biochemicals. It is BNDES’ first investment in this area, in which biofuels which are made using residue from wood, corn, sugarcane bagasse and wheat straw. GraalBio plans BRL4bn in investments during the next six years.
Category: Bonds
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CorpBanca Eyes COP Bonds
CorpBanca is considering the issue of some COP250bn ($141m) in Colombia’s local bond market in the first half of February, according to people familiar with the transaction. The bank is heard able to choose among 5, 7, 10, and 15-year maturities for the IPC-linked debt, with the sale able to be upsized to as much as COP350bn. CorpBanca is expected to manage the sale, rated AA+ on a national scale. This would be its first issuance in the Colombian market, following its entrance into Colombia’s retail banking sector through the acquisitions of Santander Colombia and Helm Bank in the past 14 months. Santander Colombia and Helm had each previously borrowed in the domestic bond market. CorpBanca has been raising money at various levels to help fund its acqusitions. CorpBanca sold $800m in 2018 bonds earlier this month in its first-ever international bond sale, clinching a 3.240% yield. It is also undergoing an equity follow-on concluding next month that is expected to raise more than $600m. Corp Group Banking, the holdco for CorpBanca, is currently preparing what is expected to be a $500m sale of 10-year bonds in the international market. Deutsche Bank and Goldman Sachs are managing the transaction, which could come as soon as this week.
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Axtel Tender Secures Majority
Mexico’s Axtel has received acceptance to an exchange offer from a majority of bondholders, it says, as of Friday’s close of the early deadline. The results satisfy a minimum acceptance condition and follow an improvement of the terms made earlier last week due to poor initial feedback. In an offer expiring January 28, the telecom is targeting its outstanding 7.625% 2017 and 9.000% 2019 bonds. It is offering $594.61 per 1,000 principal, up from $550 – comprised of $500 in senior secured 2020 bonds, $44.61 in peso-denominated dollar-indexed 2020s and $50 cash, it says. Holders who accepted before the early deadline get an extra $116 per $1,000. The new 2020 notes to be issued start at a 7.0% coupon, and step up to 8.0% after year one and 9.0% after year two. Axtel is rated Caa2/CCC+/B minus.
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BdB Targets Bigger Banvor Position
Banco do Brasil (BdB) and Banco Votorantim are studying the possibility of the government-backed lender buying additional shares in Banco Votorantim, Banco do Brasil says. Banco do Brasil holds 49.99% of the voting shares and 50% of the preferred shares Banco Votorantim, and is considering acquiring additional preferred shares. No specific target was discussed. BdB has used its position in Votorantim to expand in auto loans, paycheck loans and credit for mid-size companies. A larger piece might also be away to build up BdB’s investment banking activity.
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CorpBanca Holdco Moves Toward DCM
CorpBanca’s holding company Corp Group Banking plans to hold investor calls Tuesday and Wednesday ahead of a likely bond sale, according to people familiar with the process. The holding company is seeking $500m in senior unsecured 10-year bonds, according to Moody’s, which has assigned a Ba3 rating with negative outlook. Deutsche Bank and Goldman Sachs are managing. The issuer chose to have calls rather than a full road show. Corp Group’s subsidiary CorpBanca visited accounts before printing earlier this month a $800m DCM debut, pricing a 3.125% 2018 bond at a 3.240% yield. It then raised $160m-equivalent in the international portion of an equity follow-on, and should raise more than $600m once the entire process is complete. Moody’s notes the refinancing risks inherent in the group’s strategy of increasingly financing its acquisitions with debt alongside ongoing capital support from its controlling and other shareholders. The group’s high growth profile and cross border acquisition strategy, as demonstrated by the purchase of two banks in Colombia, add a level of uncertainty to the company’s future cash flows, it adds. As of September, Corp Group Banking and its subsidiaries reported total assets of $28bn and total net equity of $2.6bn.
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Dominican Bank Plots Bond Debut
Banco de Reservas de la Republica Dominicana (Banreservas) is preparing investor meetings ahead of a possible Tier 2 bond transaction that would be the first cross-border deal for a Dominican bank. The government-owned lender will be in London starting today, in New York Tuesday, and Boston and Los Angeles on Wednesday, according to people familiar with the matter. The bank is heard still determining its target size and tenor. Citi is managing the process. The sale is expected to be rated B2/B minus, according to ratings agencies, and would open up new territory in the LatAm FIG bond space. There has been no shortage of Tier 2 issuance in the past year, though there has not been much in the single B category to serve as pricing reference points. Though constrained by the sovereign’s B1/B ratings, Banreservas is considered one of the strongest banks in the country, owed to its size and privileged access to funding for government-related entities, Moody’s says. The proposed notes will rank junior to Banreserva’s senior unsecured debt. As of June, Banreservas was the second largest bank in the system with 28% of total assets, Fitch says, and is the government’s main paying agent and has an important share of consumer and corporate markets. An international bond would be the first from any Dominican bank, according to Dealogic data.
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Infonavit Seeks Sub-4% Pricing
Mexican mortgage and social services entity Infonavit is heard looking to price up to MXP3.167bn ($236m) in a 28-year UDI-denominated RMBS at under 4.00%. “There is a lot of appetite on behalf of investors and space in their balance sheet for participation,” says a person familiar with the deal. Pricing is scheduled for January 31. The proceeds will be used for making new mortgage loans according to Infonavit’s financial plans for 2013. Banamex and HSBC are managing the transaction, rated AAA on a national scale. Fellow government housing lender Fovissste’s MXP4.8bn in 2042 bond, paying 3.85%, is being used as pricing reference point, with Infonavit aiming to price inside that level. Infonavit’s most recent deal was a MXP3.0bn 28-year UDI-denominated bond that came at 4.6% in June.
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Davivienda Widens International Appetite
Colombia’s Banco Davivienda has increased its international bond issuance limit to $500m from $300m, it says. Colombia’s third-largest bank has been well documented as a likely issuer in Q1, though there are no firm details in place. In June of 2012 it saw 6x demand for its debut dollar bond offering, pricing a 5.875% $500m 2022 bond to yield 5.950%. Credit Suisse and JPMorgan managed. It followed in the domestic market in August, raising COP500bn ($275m) in 2022 and 2027 bonds. Davivienda is rated Ba1/BB+.
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ENAP Issues Domestic Bonds
ENAP has issued UF6m ($289m) in Chile’s domestic bond market, according to people familiar with the transaction. The state-owned oil company priced a UF2m, 5-year bullet tranche at 98.54 with a 3.4% coupon to yield 3.75%, or government bonds plus 113bp. A UF4m, 21-year bullet tranche priced at 94.70 with a 3.7% coupon to yield 4.09%, or government bonds plus 133bp. Demand for both tranches was said to exceed the amount offered, though the specific demand was not available. The proceeds are to be used to refinance debt. Banchile-Citi, JPMorgan and Scotia managed the sale, rated AAA/AA+ on a national scale. It was ENAP’s first domestic bond deal since a UF9.75m sale in 2009, according to Dealogic data. Chilean bankers say they expect this will be the last transaction ahead of the Chilean summer vacation period, with liquidity dropping off through February.
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Minerva Super-Sizes Bond
Brazil’s Minerva has priced $850m in 2023 NC5 bonds, as investors filled a book that reached about $6.5bn. The issuer upsized from a planned $500m sale. “We like the fundamentals. Minerva is an improving story and stands out as a credit from other protein companies with respect to leverage, liquidity and business profile,” says a participating London-based EM portfolio manager. The Brazilian meatpacker priced at 98.301 with a 7.75% coupon to yield 8.00%, tight to 8.25%-area guidance that followed earlier mid-to-high 8% initial price talk. The bonds jumped 3.0 points in the grey, and priced competitively to Minerva’s 2022 bonds, which were trading to yield 8.40% before announcement, according to a banker on the deal. The transaction attracted approximately 350 accounts, with 70% heard allocated to fund managers, 13% to banks and private banks, 10% to hedge funds and the remainder to insurance and pension funds. US accounts took 70%, Europeans 20% and Asians 10%. Proceeds will go towards funding a cash tender offer launched on January 11, in which the issuer is looking to replace its 9.500% 2017, 10.875% 2019 and 12.250% 2022 bonds. Minerva is offering holders $1,105 per $1,000 principal of the 2017s, $1,200 per $1,000 of the 2019 and $1,262 per $1,000 of the 2022s. The prices include a $30 per $1,000 bonus for those accepting before a January 25 early deadline. The full tender offer expires February 8. There is $34m outstanding in the 2017 bond, $372m of the 2019 and $450m of the 2022. BTG Pactual, HSBC and Credit Suisse managed the new issue and are running the tender.