Chile’s CFR is targeting November 8 for a domestic bond issue, according to people familiar with the plans. The pharmaceutical company started investor meetings this week, and is expected to issue UF2m ($96m), divided among three possible tranches. A 3.5% coupon 5-year UF bullet tranche, a 4.0% coupon 21-year tranche with a 10-year grace period, and a 6.5% coupon 5-year peso-denominated bullet tranche are the options. Proceeds could be used for M&A activity. IMTrust and Santander are managing the transaction, rated A+/A on a national scale. A sale would represent CFR’s first bond issuance.
Category: Bonds
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Gas Natural Issues Colombian Bonds
Gas Natural has issued COP300bn ($165m) in Colombia’s domestic bond market, it says. A COP100bn, 5-year tranche pays IPC+3.22% and a COP200bn, 7-year tranche pays IPC+3.34%. The subsidiary of the Spanish energy company saw more than 3x demand for the issue, which is rated AAA on a national scale. Proceeds will be used to refinance debt and for working capital. Bancolombia and BBVA managed.
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Mexico Keeps Road Securitizations Rolling
Mexico’s domestic debt market continues to see road securitization activity, with Concorcio de Mayab raising MXP4.5bn ($346m) in the country’s second-largest such transaction this year. The ICA-owned operator priced a MXP1.2bn ($92m) 2034 peso-denominated tranche with an 11.3-year average life at 9.67%, or Mbonos+420bp. A MXP3.3bn ($254m) 2034 UDI-denominated portion with an 11.7-year average life priced at 5.80%, or Udibonos+418bp. Investors and analysts had been expecting a spread to each tranche’s respective benchmark of at least 400bp prior to the transaction. “Mayab is an interesting and mature deal with stable assets and attractive pricing versus RCO, which is better rated but with compressed spreads,” says a Mexico City-based debt investor, referring to Red de Carreteras de Occidente’s (RCO) MXP8.12bn sale last month that was seen as reopening the market. Mayab’s bonds are backed by the Kantunil, Merida-Cancun highway revenues. The borrower is looking to finance a 54km road project in the Playa del Carmen region, and to repay existing debt acquired by Mayab before it was purchased by ICA in 2008. BBVA Bancomer, HSBC and Morgan Stanley managed the transaction, rated AA/A2 on a national scale, with Morgan Stanley and Cofinza as structuring agents. With RCOs deal the pair have equaled the number of transactions from last year, and increased the volume from MXP5.2bn. Other types of ABS are on the way in what is a busier market this year, with IAMSA targeting MXP3.5bn in a bus revenue securitization, and the state of Veracruz preparing a MXP6.9bn deal backed by future federal payment flows. The total volume for ABS year to date in Mexico is MXP51.3bn — including RMBS sales and a MXP13.5bn CFE transaction — according to LatinFinance data. This is already an increase from 2011’s full-year total of MXP35.2bn.
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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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Brazilian Launches Liability Management
Brazil’s Sifco has launched a cash tender offer for its 2016 bonds, and plans a new 2018 bond of up to $200m to replace it. The manufacturer of forged components for the auto industry is targeting any and all of its $75m outstanding 11.50% 2016 bonds, it says, offering $960m per $1,000 principal in an offer expiring November 20. Holders tendering before a November 2 early deadline receive $1,000 per $1,000. The deal is subject to the completion of a new bond sale. Goldman Sachs, Citi, and Banco Pine are managing the tender offer and also taking Sifco to meet investors beginning this week. The roadshow starts in New York on Thursday and then makes its way to the US West Coast, Hong Kong, Singapore, London and Boston before finishing in Miami and Santiago on November 2. The issuer is targeting a $200m 2018 sale, according to Fitch, which assigns a B minus rating to the potential deal. Sifco met investors in Europe, the US and LatAm in July with Citi and Goldman, but did not issue. The 2016 was originally sold last year through a RegS transaction.
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Fovissste Preps RMBS
Mexican government housing lender Fovissste plans to raise up to MXP5bn ($385m) through a domestic RMBS sale, and is targeting a October 30 pricing, according to bankers familiar with the sale. The 30-year bond would be denominated in UDIs and pay a fixed rate. BBVA Bancomer, Banorte-IXE and Santander are managing the sale, rated AAA on a national scale. The government-backed lender last visited the market in August, raising MXP4.8bn in 2042 notes paying 3.85%.
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Gas Natural to Issue
Gas Natural plans to issue COP300bn ($165m) in Colombia’s domestic bond market today, according to people familiar with the issuer’s plans. It can choose among 5-year and 7-year tranches, and issue fixed rate or IPC-linked bonds. The maximum interest rates are IPC+3.70% for the 5-year portion and IPC+3.90% for the 7-year piece. The subsidiary of the Spanish energy company is raising funds to refinance debt and for working capital. Bancolombia and BBVA are managing the deal, rated AAA on a national scale.
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Mayab Set for Securitization
Concorcio de Mayab plans to raise up to MXP4.5bn ($351m) in Mexico’s domestic bond market today, according to sources familiar with the sale. The ICA-owned concession operator plans a 2034 peso-denominated tranche with an 11.3-year average life, with size of the tranche not to exceed 40% of the total issuance, and a 2034 UDI-denominated portion with an 11.7-year average life and no size limit. The bonds are expected to pay a spread of 400bp-area to their respective benchmarks, according to a person familiar with the transaction. The bonds are backed by Kantunil, Merida-Cancun toll road revenues. The borrower is looking to finance a road project in the Playa del Carmen region and to repay existing debt acquired by Mayab before it was purchased by ICA in 2008. BBVA Bancomer, HSBC, Inbursa and Morgan Stanley are managing the transaction, rated AA/A2 on a national scale, with Morgan Stanley and Cofinza as structuring agents.
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Tanner Prices Domestic Bonds
Tanner Servicios Financieros has issued UF1.5m ($72m) in the Chilean local bond market. The financial services company priced the 2017 bond at 99.18 with a 4.7% coupon to yield 4.9%, or government bonds plus 256bp. The deal, by BBVA and rated A on a national scale, saw approximately 1.8x demand.