Mexico’s Banco Compartamos is scheduled to price a reopening of its 2015 floating-rate domestic bonds today. The microlender wants to reopen the bonds for MXP1bn ($78m), an amount that would bring the new outstanding size to MXP2bn. This amount would complete a desired MXP2bn outstanding size for three separate transactions done in 2010, 2011 and 2012 under an MXP6bn program. Price talk is at TIIE+59bp-area. Proceeds will be used to refinance short-term indebtedness. Banamex is leading the transaction, rated AAA/AA on a national scale. The original MXP1bn bond priced at TIIE+130bp in 2010.
Category: Bonds
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Pemex Seeks Diverse 2013 Funding Targets
After a groundbreaking debt fundraising year, Pemex is targeting issuance in more new markets in 2013, its treasury manager says. The Mexican state-owned oil company has put in a request to borrow about $9.8bn-euqivalent in 2013, subject to government approval, with about $4.0bn expected to come from the international markets. After hitting up the Swiss market and becoming LatAm’s first Australian dollar issuer this year, other non-USD markets may be in the cards. “We would certainly look at the Euro market as we do every year and we would look at some currencies in Latin America. The swap to dollars makes it difficult to structure those trades, but Pemex could turn to South American currencies like in Peru or Colombia which might make sense in our funding program,” Mauricio Alazraki tells LatinFinance. It is not necessary to go to non-USD markets, the official adds. In the dollar markets, a retap of its 2044 USD bond is a distinct possibility, he says, after raising $3bn from it this year. Like other Mexican blue-chips, Pemex would like to take advantage of growing investor appetite for domestic peso debt. “We aim to tap the domestic market more frequently, ideally every quarter to give the market more certainty,” he says, noting that $2.5bn-$3.5bn-equivalent would be ideal next year. Using its successful GDN format to tap both foreign and local buyers is among the options, though the global peso securities debuted by America Movil this year also give borrowers another option. “Titulos de credito extranjeros is a great program and we have to see if that is a way to go or to work on our GDN format and provide it with more liquidity. There are similarities in terms of documentation. One of the advantages of the GDN is that it is easier to identify amount to withhold. Obviously what America Movil did was a great transaction,” Alazraki says. Pemex would also like to have $1.5bn-$2.0bn from ECA funding next year, including a possible revisit of its US Ex-Im backed bonds
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Pulp Producer Completes Domestic Bond
Eldorado Celulose e Papel has raised BRL940m ($450m) in Brazil’s domestic bond market, according to Anbima. The inflation-linked 2027 debenture pays 7.41%, in line with expectations. The bond amortizes monthly beginning after one year. Proceeds will be used for capex at Eldorado’s Tres Lagoas facility in Mato Grosso do Sul. Banco do Brasil managed the sale, done under the rule 476 restricted format.
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Santher Plots Local Debt
Fabrica de Papel Santa Therezinha (Santher) plans to raise BRL125m ($60m) in Brazil’s local bond market, according to regulatory documents. The paper company plans a 2016 debenture that pays the DI plus a spread of 3.40%-4.15%, depending on its credit rating. Santher is raising funds to repay debt and for working capital. It does not identify the manager of the sale, to be done under the rule 476 restricted format. It raised BRL230m in June, paying DI+3.6%.
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Generator Plugs into Local Bond Market
Linhares Geracao, the operator of a power plant in Brazil, has raised BRL220m ($105m) in the domestic debenture market, according to Anbima. The plant, controlled by BTG Pactual’s FIP Brasil Energia private equity fund, priced a 2024 inflation-linked bond at 7.25%. BTG managed the sale, done under the rule 476 restricted format. The gas-fired Linhares plant is located in the state of Espirito Santo.
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Grupo Kuo Tender Reaches $230m
Mexico’s Grupo Kuo has received acceptance from holders of $230m, or 92.12%, of its $250m 9.75% 2017 bonds targeted in a tender offer, it says. The BB rated conglomerate’s acceptance rate at the December 14 deadline was only slightly higher than the $229m it had at the November 30 early deadline. Grupo Kuo offered holders $1,053.75 cash per $1,000 principal through the early deadline, and $1,023.75 per $1,000 through the final deadline. Credit Suisse managed the tender, and was joined by Citi and Bank of America Merrill Lynch on the sale of new 2022 NC5 bonds issued to fund it. The new 2022 bonds priced at par with a 6.25% coupon last month.
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Inmet Raises Additional Panama Project Funds
Inmet Mining has returned to the bond market for additional funding for its Panama copper projects, raising $500m. The Canadian miner’s 2021 drew $3.9bn in orders. The B1/B+ bond priced at 100.00 with a 7.50% coupon and yield, or UST+610bp, pricing inside 7.75%-area price thoughts. The bonds were quoted at 102.00 in the secondary Monday afternoon. The proceeds will be used to fund the development and potential early expansion of the $6.18bn Cobre Panama copper project in Panama, of which Inmet has an 80% share. Inmet raised a $1.5bn 2022 NC4 bond in May, with the 8.75% coupon note trading at 7.10%-7.15%. Credit Suisse and JPMorgan managed.
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Lojas Americanas Plans Bonds
Brazilian retailer Lojas Americanas is planning to raise BRL650m ($310m) in the domestic bond market, it says. It plans a BRL300m 5-year tranche paying the DI+1.03% and a BRL350m 6-year tranche paying 113% of the DI. It does not give additional information about the sale, to be done under the rule 476 restricted format.
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Santander Brasil Eyes New Markets
As Santander Brasil prepares a non-deal roadshow in Switzerland for early 2013, the Brazilian bank will continue to evaluate new markets throughout the year, Alvaro Carbajosa, Santander Brasil’s head of international funding, tells LatinFinance. The bank recently wrapped up fixed-income meetings in Chile, Colombia and Peru in October after seeing accounts in Hong Kong, Singapore and Taiwan in August. Following Santander Chile with an offshore renminbi, or Dim Sum, transaction via public or private placement is a possibility. “Santander Chile was an excellent transaction. It was the first financial to open the market with a public transaction, opening the door to a new investor base, diversifying into a new market and getting Santander noticed,” Carbajosa says. He does not indicate timing for attempting such a sale, or give additional details about the Swiss meetings. While Santander banks have suffered in the secondary market given association with the Spanish parent, Carbajosa reiterates Santander Brasil is independent in terms of funding and well coordinated with other Santander units on when they plan to come to market. Carbajosa also emphasized that while Santander Brasil is flexible in its funding plans and considers different currencies and tenors if swaps make sense, at least 10%-15% of total funding has to come from USD.
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Toll Road Sale Ends Brazil DCM Year on Strong Note
Brazilians are hopeful 2013 can top this year’s domestic bond market volume, with interest rates and the country’s infrastructure needs among the catalysts. In a positive sign, toll road operator Concessionaria Auto Raposo Tavares (CART) raised BRL750m ($357m) while getting foreigners to buy infrastructure debentures for the first time, in what is likely the domestic market’s final widely-distributed debenture sale of 2012. Volume for such deals, known as rule 400 transactions, stands at BRL14.30bn through Monday, according to the CVM, if large bank leasing deals are excluded. This easily tops last year’s BRL3.18bn total and nearly matches the BRL15.63bn raised in 2010. “The market this year was good in terms of volume and the number of transactions that took place, though there were still a lot of 476 deals,” says a DCM banker away from the CART transaction, referring to the limited distribution rule 476 bond transactions. This type of deal – often bought by a single bank – is also set to beat last year’s volume, with BRL62.74bn issued as of Monday, according to Anbima, up from the BRL48.10bn full year 2011 total. Both formats are important options for issuers, bankers say, but the more widely distributed sales are necessary for developing a secondary market that could encourage more corporate issuance. “The 476 trend is clearly reaching some limits of some important fund managers. I think we are going to see more and more 400s going forward,” says a Sao Paulo-based DCM banker. Infrastructure debentures, where foreign and domestic retail investors get tax incentives, should help as the new asset class develops. CART’s 2024 inflation-linked bond was divided into two parts to accommodate the foreign and local investor bases. A BRL380m 2024 tranche pays 5.8% and went to international investors, who benefit from not paying IOF tax due to the use of proceeds. A BRL370m portion pays 6.05% and was placed with domestic buyers. Both tranches saw much lower yields than the 8