IAMSA will look to price a MXP3.5bn ($270m) securitization in the Mexican domestic bond market on Monday, say people familiar with the inter-city bus company’s plans. The 15-year deal is backed the bus operator’s 1,438 buses and future ticket sale revenue, and will raise funds to repay bank debt. Santander is managing the transaction, rated AAA/AA minus on a national scale.
Category: Bonds
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Southern Copper Back on the Road
Southern Copper will be on the road Monday and Tuesday as it seeks to raise funds in the international bond market. The Peru-based unit of Mexican miner and railroad operator Grupo Mexico plans to visit London and Los Angeles Monday and New York and Boston Tuesday. Bank of America Merrill Lynch, Credit Suisse, HSBC and Morgan Stanley are managing. It cancelled a roadshow in September following the announcement of a US court judgment against Grupo Mexico. At the time, the Baa2/BBB/BBB issuer was planning 10-year and 30-year bonds, according to ratings agencies. Southern Copper last issued in April 2010, pricing a $400m 10-year and $1.1bn 30-year tranche through Credit Suisse, Goldman Sachs and Morgan Stanley.
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Banco Industrial Upsizes Bond
Guatemala’s Banco Industrial has raised $500m in the international bond market, upsizing from an expected $300m. Investors put in for $4.5bn in orders for what lead managers are calling the largest-ever non-sovereign bond from a privately-owned Central American issuer. Guatemala’s largest bank priced the Baa3/BB 2022 bond at par to yield 5.500%, tight to 5.500%-5.625% guidance that followed low 6.000% whispers. “We saw value in today’s Banco Industrial deal. It’s the top bank in Guatemala, has strong support from equity holders, improving credit metrics and upward momentum for the ratings,” says a participating EM portfolio manager. The bonds were trading up 0.50 in the grey, according to the investor. While difficult to comp to Industrial’s illiquid $150m 10-year subordinated Tier 2 bonds, leads say the deal offered investors at least 130bp pickup to the Guatemala sovereign. “This deal demonstrates investors’ search for diversification and yield in a fundamentally strong market. It is an issuer’s market,” adds a DCM banker away from the deal. Approximately 268 accounts participated in the deal, which follows a 3-day US, European and LatAm roadshow. Proceeds from the sale will be used to address Banco Industrial’s short-term debt and fund growth of its credit portfolio. Bank of America Merrill Lynch and Citi managed the transaction, issued by the Industrial Senior Trust entity with a guarantee from Banco Industrial.
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Caixa to Split Bond Issuance
Brazil’s Caixa Economica Federal has added a 10-year tranche to its benchmark-size bond transaction, alongside the previously announced 5-year, according to sources following the sale. Guidance of UST+200bp-area has been set for each tranche, with pricing expected today. A $1.0bn-1.5bn size is expected, according to ratings agencies. The BBB/Baa1 government-owned lender finished fixed-income investor meetings in the US, Europe and Asia this week. Bank of America Merrill Lynch, Deutsche Bank and HSBC are managing the bond sale, representing a debut in the international markets.
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Chile Taps Tight Dollar Funds
The Republic of Chile has raised $1.5bn during its first visit to the dollar markets this year, landing what the issuer calls the lowest-ever coupon and yield for an emerging market bond at the 10 and 30-year points. “It’s a very strong credit. No new issue premium and difficult to see much value in such tight spreads. Even so, the book was hugely oversubscribed,” says a North American EM portfolio manager following the process. Indeed, demand for the 10-year tranche reached $4.1bn while the 30-year saw $4.8bn, with each getting approximately 300 accounts to participate. The $750m 2022 priced at 98.858 with a 2.250% coupon to yield 2.379%, the tight end of UST+60bp-area guidance which followed UST+75bp-area whispers. A $750m 2042 priced at 98.398 with a 3.625% coupon to yield 3.714%, the tight end of UST+80bp-area guidance following earlier UST+95bp whispers. The bonds were quoted trading up 0.30 in the grey, after being up as much as 0.50 earlier in the day, according to investors. “In terms of trading in the grey, it tells me they tightened to the right point. Like everything else these days, they priced extremely tight,” says a second EM investor. Chile revisited the debt capital markets with the objective of developing its yield curve and issuing a long-end reference benchmark for future corporate Chilean borrowers, as well as to pre-finance at low rates. Bank of America Merrill Lynch, HSBC and JPMorgan managed the A+/Aa3 rated transaction. Further investment-grade sovereign issuers are expected to emerge, investors say, with Brazil tipped to possibly return before year-end or early 2013 to retap its 2023 and bring it closer to a $3bn targeted benchmark size. Uruguay is another candidate mentioned by the buyside that could take advantage of low rates.
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Colombian Prices Hotel-Backed Bond
Hoteles Estelar has issued COP80bn ($44m) in 2027 asset-backed bonds in Colombia’s domestic market. The bonds pay IPC+4.25%, and are guaranteed by the La Fontana hotel in Bogota and Hotel Intercontinental in Cali. The hotel operator plans to use half of the proceeds to repay debt, with the other half earmarked for a landmark hotel project in Cartagena. Corficolombiana and Casa de Bolsa led the transaction, rated AAA on a local scale. Estelar debuts in the bond market with the deal, and will look to issue shares in a few years, say people familiar with its plans.
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H2Olmos Taps Domestic Bond Market
H2Olmos has issued PES330m ($128m) in Peru’s local bond market. The water concession unit of Brazil’s Odebrecht sold a PEN78m 2018 bond paying 5.40% and PEN253m inflation-linked 2032 bond with an interest rate of 4.25%. The 6-year tranche saw 2.75x demand and the 20-year 2.26x. Scotia managed the sale, rated AA+/AAA on a national scale. H2Olmos has a 25-year concession to construct, operate and maintain the Olmos irrigation project in Peru.
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Banco de Chile Aims for Peruvian Tap
Banco de Chile is preparing to issue approximately $100m in Peruvian sol-denominated bonds in a private RegS-only deal, say people familiar with the bank’s plans. The transaction is expected to have a maturity of 5-10 years and proceeds will be used for loan portfolio financing and general corporate needs, says S&P, which assigns an A+ rating. JPMorgan is heard to be managing.
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Banco Industrial Sets Target
Guatemala’s Banco Industrial is aiming for a low 6.00%-area yield on a new $300m 2022 senior unsecured bond, according to people following the deal, expected to price as soon as today. The price talk is inside Industrial’s own $150m 10-year subordinated Tier 2 bonds, which were trading around 6.79% Wednesday. Investors expect the deal to offer an attractive pickup to the Guatemala sovereign (Ba1/BB/BB+), trading recently at 4.20%-4.30% levels. Baa3/BB Industrial ended a 3-day US, European and LatAm roadshow Wednesday. Proceeds from the sale will be used to address short-term debt and fund growth of its credit portfolio. Bank of America Merrill Lynch and Citi are managing. The bond will be issued by the Industrial Senior Trust entity and comes with a guarantee by Banco Industrial.
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Banobras Plots Local Issue
Banobras plans to issue up to MXP5bn ($385m) in bonds in the Mexican domestic market. The government development bank plans to issue 3-year bonds paying a spread to the TIIE benchmark. It is estimating a November 7 sale, according to a selling memo. Banamex and BBVA Bancomer are managing the sale, rated AAA on a national scale. Banobras last issued in the local market in July via Banamex, when it sold MXP2bn in 2022 bonds at 6.12%, or Mbonos+50bp, after generating 1.31x in demand.