Banco do Brasil has added $175m to its 10-year senior bond, exercising the 10% greenshoe option during Asian market hours and bringing the total issue size to $1.93bn. Banco do Brasil priced the new 2022 senior unsecured bond Tuesday at 98.978 with an 3.875% coupon to yield 4.000%, or UST +237bp, tight to 4.125%-area guidance revised from earlier 4.375%-area initial talk. Banco do Brasil, BNP Paribas, Bradesco, BTG Pactual, Citi and JPMorgan led the transaction, with Banco Safra and Mizuho as co-managers.
Category: Bonds
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Brazil Sees First Infrastructure Debenture
While small even by domestic market standards at BRL25m ($12m), ACS’s Montes Claros transmission project has priced Brazil’s first infrastructure debenture to be placed with investors, according to sources familiar with the transaction. The 17-year inflation-linked debenture pays 8.75%, and features a security package pari-pasu with the issuer’s BRL123m in BNDES debt. Proceeds will fund about 10% of the transmission project. BNP Paribas structured and managed the transaction, placed with 18 of the bank’s Brazilian wealth management clients under the rule 476 restricted format. CCR’s AutoBan toll road unit is expected to finalize pricing as soon as next week for the first infrastructure debenture done under the more widely marketed rule 400 format. The BRL950m sale is to be the first sizeable infrastructure debenture, or domestic bond sold under legislation passed last year offering incentives to foreign and individual buyers as long as the use of proceeds is infrastructure-related. AutoBan plans a BRL850m 2017 tranche paying up to 109.2% of the DI, and a BRL150m 2017 inflation-linked tranche paying a fixed rate set to the yield of the government NTN-B bond at the time of pricing plus up to 0.25%. The deal is able to be upsized to as much as BRL1.28bn. Banco do Brasil, Caixa and HSBC are managing the sale, rated AAA on a national scale. For now infrastructure debentures large and small are likely to marketed to individuals, bankers say, with foreigners participating once the new asset class is better established.
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Brazilian Debutant Preps Investor Meetings
Brazilian infrastructure group OAS plans to meet bond investors in Europe, and the US starting Friday, ahead of what would be a debut sale in the international market. The B/BB minus rated Brazil-based infrastructure group will visit accounts in beginning in Switzerland Friday, followed by visits to London, Boston and New York Wednesday before wrapping up in Los Angeles on October 11. A 144A/RegS dollar transaction may follow subject to market conditions. Banco do Brasil, Bradesco, BTG Pactual, Deutsche Bank, HSBC and Itau are managing.
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Colpatria Raises Local Funds
Banco Colpatria has raised COP150bn ($83m) in Colombia’s domestic bond market, according to sources familiar with the transaction. The 10-year inflation-linked subordinated bonds pay 4.14%. Demand reached COP497bn Colpatria self-managed the sale, rated AA+ on a national scale, below its AAA senior rating. It previously issued in February, selling COP150bn in similar 10-year notes paying 4.64%.
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Ford Credit Raises MXP Funds
Ford Credit de Mexico has sold MXP2bn ($156m) in 2014 bonds in the domestic market, according to sources familiar with the transaction. The auto finance services company priced at TIIE+69bp, inside of TIIE+75bp price talk. The deal was heard 2x oversubscribed with 100 bids. Actinver, HSBC, Banorte-IXE and Scotiabank managed the transaction, rated AA/Aa3 on a national scale.
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Inbursa Clinches Domestic Bond
Mexico’s Banco Inbursa has raised MXP5bn ($389m) in the domestic bond market, according to sources familiar with the transaction. The 2015 notes priced at TIIE +25bp, in line with TIIE+23bp-25bp price talk. Proceeds will be used to increase liquidity and grow the bank’s credit portfolio. The bank has issued MXP13bn this year in the domestic market. Inbursa, Banamex, Banorte-Ixe and Actinver managed the transaction, rated AAA on a national scale. Inbursa last issued in May, selling a floating-rate note paying the TIIE+25bp.
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OGX Drills Domestic Debt
Brazil’s OGX has finalized the sale of BRL2.1bn ($1.03bn) in Brazil’s domestic debenture market, according to Anbima. The EBX-controlled oil and gas company’s 2022 pays 10.5%. HSBC managed the sale, done under the rule 476 restricted format.
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Sanluis Puts Brakes on Bond
Mexican vehicle parts manufacturer Sanluis has postponed plans to raise funds in the international bond market, according to people following the 2022 NC5 bond transaction. After widening the yield target to 10%-area from initial high 9% talk, the issuer was heard generating close to $200m in orders. “The company decided to postpone due to the market not meeting its pricing expectations,” says a person familiar with the transaction. The issuer is heard satisfied with explaining its story and its improvement in credit metrics following a 2011 debt restructuring, and could consider another DCM attempt. Sanluis was looking to raise $200m-$250m in order to refinance debt. Bank of America Merrill Lynch and JPMorgan were managing the Ba3/B/B+ transaction.
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Telefonica Chile Talks Price
Telefonica Chile is aiming for UST+250bp-area pricing on a new 2022 bond after tightening from UST+275bp-area initial price thoughts Wednesday. The unit of Spain’s Telefonica is planning a $500m issuance, according to Fitch, which assigns a BBB+ rating. Proceeds are destined to refinance upcoming maturities of 2013 and 2014, and also working capital needs and capital expenditures. “Outside of banking there is a shortage of Chilean paper,” says an investor following the trade. Another looking at the deal finds the 250bp level to represent fair value. Fitch notes a solid financial profile and strong operating cash flow generation, while also taking into account a strong competitive environment, low regulatory risk, weaknesses in local traffic and a policy of returning cash to shareholders. The telecom wrapped up investor meetings on Wednesday in Boston, Lima and Los Angeles. BBVA, Citi and JPMorgan are managing the process. Telefonica Chile is rated BBB/BBB+.
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Agricultural Fund Raises Tight Local Bond
Fondo Especial para Financiamentos Agropecuarios (FEFA) has sold a MXP3bn ($233m) bond in Mexico’s domestic market, according to sources familiar with the sale. The 2015 notes priced at TIIE+20bp, tight to TIIE+25bp expectations that were based on the issuer getting that level on a similar deal earlier this year. FEFA saw 3.5 x demand, coming from 93 accounts, according to a source familiar with the sale. Proceeds will be used to fund operations. Banamex, BBVA Bancomer and HSBC managed the transaction rated AAA on a national scale. FEFA is a trust operated by second-tier development bank Fideicomisos Instituidos en Relacion con la Agricultura (FIRA). Established in 1954 by Mexico’s federal government, FIRA offers credit and guarantees among other services to livestock, fishing, forestry and agribusiness sectors in Mexico.