Mexico’s Banobras has raised MXP2.5bn ($195m) in domestic bonds. The government development bank’s 2015s pay TIIE minus 3bp. Demand reached MXP5.2bn, according to a person familiar with the sale. Banamex and BBVA Bancomer managed the deal, rated AAA on a national scale. Banobras previously issued in the local market in July, when it sold MXP2bn in 2022 bonds at 6.12%.
Category: Bonds
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Itau Adds Asia Greenshoe
Itau has added $170m to its long 10-year Tier 2 bond, exercising the 10% greenshoe option during Asian market hours and bringing the total issue size to $1.84bn. The Brazilian bank priced the subordinated notes Monday at par with a 5.125% coupon, to yield in line with 5.125%-5.250% guidance. Banco do Brasil, Itau, JPMorgan and Santander managed the Baa2/BBB sale.
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Posadas Takes to the Road
Grupo Posadas is meeting fixed-income accounts this week, after launching a cash tender offer last week targeting its $200m outstanding in 9.250% 2015 bonds. The Mexican hotel operator’s roadshow begins today in New York, and visits Boston, Los Angeles, London and Zurich before wrapping up in Santiago November 14. Bank of America Merrill Lynch, Citi, Deutsche Bank, Santander and JPMorgan are managing. The Mexican hotel operator is offering holders $1,045 per $1,000 principal before a November 14 early deadline, and $1,015 through the final November 29 deadline. Bank of America Merrill Lynch and JPMorgan are handling the tender.
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Santander Mexico Prices Bond Debut
In its international DCM debut, Santander Mexico has raised $1bn in 2022 senior unsecured bonds while getting $4.3bn in demand. The addition of debt follows a well-received $4.1bn IPO in September. The BBB/BBB+ rated transaction priced at 98.183 with a 4.125% coupon to yield 4.351%, or UST+260bp, the tight end of UST+265bp-area guidance which followed high 200bp talk. The bonds were trading up 0.125-0.375 points in the grey Tuesday afternoon. Some investors reported looking at BBVA Bancomer’s (A1/A minus) $1bn 2022 Tier 2 bonds, seen as a somewhat useful comp despite differences in subordination. “Santander is coming at about 60bp behind BBVA. This is senior debt and one has to give Santander the benefit of the doubt, given its balance sheet and status as a first time issuer. This is a Mexico story and as the economy grows at a moderate pace we may see more from Santander Mexico as it seeks to tap large sources of funding,” says a US East Coast-based EM investor. A Swiss-based investor found Santander’s spread attractive compared to AA3/A/A+ rated Santander Chile quoted at a spread of UST+190bp. More than 250 accounts were heard participating. Santander intends to use proceeds to extend duration of liabilities and to refinance debt maturing in the first half of 2013. Deutsche Bank, Goldman Sachs and Santander managed the transaction.
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Sifco Aims Bond
Brazil’s Sifco is aiming for a yield of 12.75%-area for a $200m 2018 bond, according to investors following the deal, expected to price as soon as today. The manufacturer of forged components for the auto industry is looking to replace its $75m in 11.50% 2016 bonds, and recently launched a cash tender offer. Sifco is offering $960m per $1,000 principal in an offer expiring November 20 and subject to the new bond sale. Goldman Sachs, Citi, and Banco Pine are managing the tender offer and also took Sifco to meet investors through last week. The 2016 was originally sold last year through a RegS transaction.
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Volkswagen Leasing Set for MXP Sale
Volkswagen Leasing Mexico is scheduled to sell a MXP2.0bn ($155m) bond in Mexico’s domestic market today. The auto lender is expected to price the 2015 at around TIIE+25bp-35bp, according to people following the transaction. The issuance is guaranteed by parent VW Financial Services, and raises funds for operation. Santander and BBVA Bancomer are managing the deal, rated AAA on a local scale.
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Chilean Lender Brings 5-year
Banco del Estado de Chile has printed a $500m 2017 bond, after generating more than $1bn in demand. The government-owned lender priced at 99.650 with a 2.00% coupon to yield 2.074% or UST+137.5bp, in line with UST+137.5bp-150bp guidance. The bonds were trading up 0.125 points in the grey, according to a trader. Leads were heard calculating 0bp-2bp concession, based on a G-spread level of 135bp for the bank’s outstanding 2022 bonds. In all, about 100 accounts participated. Citi, Deutsche Bank, HSBC and JPMorgan led the 144A/RegS transaction, rated Aa3/A+/A+. The sale follows the $500m 2022, sold in February via Deutsche Bank and JPMorgan.
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Itau Adds Tier 2 Debt
Itau has raised $1.7bn in 2023 Tier 2 bonds, seeing orders north of $6.5bn. The Brazilian bank priced the unsecured subordinated notes at par with a 5.125% coupon, to yield in line with 5.125%-5.250% guidance. The bonds traded up 0.45-0.75 points in the grey Monday afternoon, according to an investor. Itau was seen as opting for size over pricing, offering investors a decent concession versus levels on its outstanding 2021 and 2022 Tier 2 bonds. “The deal priced 30bp cheap to the existing curve,” says one participating investor. Around 300 accounts participated. The issuer has an option to exercise up to 10% greenshoe during Asian hours. Proceeds will be used to strengthen the bank’s capital structure and for general corporate purposes. Banco do Brasil, Itau, JPMorgan and Santander managed the Baa2/BBB sale. The sale follows a similar $1.25bn 2022 Tier 2 sale in July. Beginning January 2013, banks will no longer be allowed to issue under the current Tier 2 format.
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QGOG Floats Debut Corporate Bond
Queiroz Galvao Oleo e Gas (QGOG) has issued its first non-project bond in the cross-border markets, raising $700m, up from an originally planned $600m. The BB+/BB minus Brazilian oil services provider drew more than $3bn in orders. The 2019 NC4 priced at 98.612 with a 6.250% coupon to yield 6.500%, at the tight end 6.750%-area guidance revised from 7.000%-area. Investors put in for more than $3bn in orders, with some noting a pickup. “It’s a great credit, and this deal came 200bp-300bp back to existing bonds,” says a participating EM portfolio manager, referring to the issuer’s investment-grade project bond. Closer comps were difficult to find. Among other considerations, investors saw QGOG’s predictable cash flows from its Petrobras contracts offsetting the issuer’s 6x-plus net leverage. Nearly 200 accounts participated, according to people familiar with the sale. Proceeds from the issuance will be used to refinance short-term debt. BAML, HSBC and Citi managed the transaction, done the QGOG Constelation unit. QGOG had previously tapped the project bond market last year, raising a $700m 7-year drillship securitization priced to yield 5.45%.
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Santander Mexico Talks Price
Santander Mexico is heard aiming for a yield of UST plus high 200bp for a new 10-year benchmark bond, according to a person familiar with the sale. The bank has wrapped up fixed-income investor meetings, and is expected to price as soon as today. The Mexican lender is planning up to $1bn for its planned 10-year senior unsecured bond sale, S&P says while assigning a BBB rating. Deutsche Bank, Goldman Sachs and Santander are managing.