Mexico’s Axtel has increased its offer to bondholders and extended the early deadline on a tender for its outstanding 7.625% 2017 and 9.000% 2019 bonds. After hearing investor feedback, the telecom is now offering $594.61 per 1,000 principal, up from $550 – comprised of $500m in senior secured 2020 bonds, $44.61 in peso-denominated dollar-indexed 2020s and $50 cash, it says. Holders accepting before a January 18 early deadline – pushed back from January 11 – get an extra $116 per $1,000, up from the $100 originally offered. The full offer expires January 28. 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. “Many bond holders who held out on the first offer are likely to accept this one, increasing participation well above the majority required,” Barclays says. The shop values the offer at $69.67, up from $53.25 assuming an exit yield for the new notes at 10%. Axtel has also included clauses allowing it to redeem the 2020 notes. There is currently $275m outstanding in the 2017s and $490m in the 2019s. Axtel has set a limit of issuing up to $357m in the dollar 2020s, up to MXP336m ($26m) in the peso 2020s, and up to $115m in cash. Axtel is rated Caa2/CCC+/B minus.
Category: Bonds
BdB Seeks Funding Diversification
After a successful and innovative 2012, Banco do Brasil (BdB) will look to diversify its debt funding even more in 2013, and is eyeing another Japanese issuance and new sources including a Chilean huaso bond. “Our strategy has been to build Banco do Brasil’s curve, and now we would like to diversify. Not only with investors, but also geography. We are thinking about doing more in Japan, and are thinking about some alternatives in Latin America. Chile is a good example,” Ivan Monteiro, the bank’s CFO, tells LatinFinance. Hitting these markets would come in addition to planned borrowings in dollars and Euros. Banco Pine opened the Chilean domestic bond market for Brazilian banks last year and others have been tipped to follow. A Japanese sale from BdB this year would follow a successful JPY24.7bn ($315m) 2015 Euroyen deal in 2012. Brazil’s lenders have also been making use of the Dim Sum market. BdB raised about $60m in two Hong Kong offshore RMB-denominated sales last year, and Monteiro says others are a possibility this year. A key for Japan, Hong Kong and other markets is maintaining a long-term presence, he notes. There is no specific timing yet for dollar borrowings, though the official notes conditions are favorable. “The beginning of this year is better if you compare it with 2012. There is a lot of liquidity, but a lot less volatility. That is encouraging a lot of new issuance, at very good prices,” Monteiro says. The pools of liquidity in the US are stronger than ever, thanks to BB’s US operations allowing it to use the 3A2 format. This exception to the SEC process allows for an even broader class of investors than 144a. Monteiro declines to discuss the planned IPO of the BdB Seguridade unit, citing a quiet period. According to regulatory documents, the bank aims to carve out the insurance business entity at some point this year, with the market expecting a BRL5bn ($2.46bn) transaction.
Brookfield Defines Domestic Bond
Brookfield Incorporacoes has determined terms on a BRL300m ($148m) domestic bond sale. The developer plans two tranches, according to regulatory documents. A 2016 portion pays DI plus up to 1.65%. An inflation-linked 2018 piece pays up to 6.10%. It is raising funds to repay debt and for working capital. The size of each is to be determined during bookbuilding, with the issue able to be upsized by as much as BRL105m. JPMorgan and Itau are managing.
CAF Raises Tight CHF Funds
Corporacion Andina de Fomento (CAF) has raised CHF250m ($272m) in new 2021 bonds, pricing slightly inside its dollar curve, according to sources following the process. The Venezuela-based development bank priced at 100.094 with a 1.375% coupon to yield 1.363%, or mid-swaps plus 55bp, at the tight end of 57bp-area guidance. Bankers encouraged the multilateral to opt for a longer tenor as it would allow the issuer to gain more access to accounts outside of the private retail investor space. In the end, the 8-year transaction attracted a mix of asset managers and insurance companies with some participation from pension funds. Approximately 80 accounts were heard participating. It was CAF’s eighth CHF deal and its longest maturity and lowest coupon in the currency to date. Credit Suisse managed. Officials at CAF have previously said the bank continues to analyze the USD, EUR, GBP and JPY markets. CAF is rated AA minus/Aa3/A+ with stable outlook.
Infonavit Bond Moves Ahead
Mexico’s Infonavit plans to meet investors next week ahead of a MXP3.0bn ($238m) domestic RMBS sale, according to a person familiar with the Mexican mortgage and social services entity’s plans. The 28-year UDI-denominated bond is backed by Infonavit mortgages, and could price 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. Infonavit – through its Infonavit Total unit – last sold MXP1.97bn in UDI-denominated 2040 RMBS bonds in June, pricing at 4.20% via Banamex and Bancomer.
Bradesco Adds RMB Debt
Adding to what is becoming a steady trickle of Brazilian banks to Hong Kong’s Dim Sum bond market, Bradesco has raised CNH350m ($56m). The lender’s 2016 bond priced at par with a 3.7% coupon in a private sale, according to sources familiar with the matter. Proceeds are for general funding purposes. BNP Paribas managed the sale. Bradesco is rated Baa1/BBB/BBB+. The Brazilian lender raised CNH300m in December, pricing a 2014 bond at a 3.90% yield. Banco do Brasil and BTG Pactual also made use of the offshore renminbi-denominated market, and Santander Brasil has indicated intentions to join them.
Cabei Visits CHF Market
Cabei has raised CHF150m ($164m) in new 2020 bonds, according to people familiar with the matter, its first deal in Switzerland since 2010. The bond priced at 100.198 with a 1.50% coupon to yield 1.47%, or mid-swaps plus 80bp. Proceeds are for general funding purposes. UBS managed the deal, rated A/A2. Cabei did a CHF150m 3-year bond in its first visit in 2010, landing at MS+150bp.
Cyrela Commercial Plots Debentures
Brazil’s Cyrela Commercial Property plans to raise BRL150m ($74m) through the sale of domestic bonds, it says. The developer’s 2018 debenture would pay DI plus up to 1.0%, and amortize in two parts during the final two years. Proceeds are for working capital. Banco do Brasil is managing the sale, done under the rule 476 restricted format.
Findeter Looks to International Market
Colombia’s Findeter will look to issue $500m in bonds in the international markets this year, it says. After regularly tapping the domestic market, such a sale would be the Colombian state-owned development finance agency’s cross-border debut, according to Dealogic data. Education and health top the priorities for the proceeds. In its most recent transaction in November, Findeter issued COP289.7bn ($160m) in the domestic bond market, through a 3-tranche deal that saw nearly COP446bn in total demand. It sold COP99.7bn in 2014 bonds at DTF+1.27%, COP91.5bn in 2016s at DTF+1.55%, and COP98.5bn in 2018s at DTF+1.71%.
Minerva to Extend Curve
Minerva has launched a cash tender offer targeting three series of pricey bonds, it says, and will meet investors starting today ahead of a likely 10-year new issue, according to sources familiar with the process. The Brazilian meatpacker is to visit London, New York, Boston and Los Angeles through Wednesday. The proceeds will be used to repurchase the 9.500% 2017, 10.875% 2019 and 12.250% 2022 bonds involved the tender. Minerva is offering $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 2022. The prices include a $30 per $1,000 bonus for holders accepting before a January 25 early deadline. The full offer expires February 8. There is $34m outstanding in the 2017 bond, $372m of the 2019 and $450m of the 2022, and Minerva has set a $500m cap on the buyback. BTG Pactual, HSBC and Credit Suisse are managing the tender and new issue. Peer Marfrig is also on the road ahead of a likely $300m 2017, and is scheduled to finish a roadshow Tuesday.