Brazil’s Taesa plans to sell BRL1.6bn ($792m) in domestic bonds, according to a prospectus, reducing the target from a previously indicated BRL2.5bn. The transmission company owned by Cemig plans to hold a roadshow September 20-25, and aims to conclude bookbuilding by October 10. The debenture sale includes a 2017 tranche paying DI plus up to 1.0%, an inflation-linked 2020 tranche paying a fixed rate set to the government NTN-B bond plus up to 1.55% and an inflation-linked 2024 tranche paying a fixed rate set to the NTN-B plus up to 1.65%. The exact sizes and interest rates will be determined during bookbuilding, and overallotment options could bring the total size to as much as BRL2.16bn. Proceeds will help refinance short-term debt totaling BRL2.08bn taken out in 2011 and 2012. Taesa is also considering the issue of BRL1.2bn in one-year debt alongside the debenture sale. Itau is managing the sale, which has not yet been assigned a rating. Taesa is rated AAA/Aa1 on a national scale.
Category: Bonds
Itau Set for Chilean Issuance
Itau plans to issue UF1m ($47m) in 14-year bullet bonds in Chile’s local market Wednesday, according to a source familiar with the bank’s plans. The bonds are rated AA/AA minus on a national scale and come with a 3.75% coupon. Itau is managing the sale. In August, the bank issued UF2m in the Chilean market, pricing a UF1m 2019 bullet tranche at 99.41 with a 3.5% coupon to yield 3.6%, and a UF1m 2028 at 99.40 with a 3.75% coupon to yield 3.8%.
Light Clinches Local Bonds
Brazil’s Light has completed the sale of BRL500m ($245m) in bonds in the domestic market, it says. The utility’s 2026 bond pays the DI+1.8%. BRL470m of the issue was done through the Light Servicos de Eletricidade unit, and BRL30m through Light SA. Proceeds fund Light’s project pipeline. Caixa Economica Federal is managed the sale.
Santander Chile Meets Buyside
Santander Chile is on a 2-day roadshow this week ahead of a potential transaction in the bond market. The bank had visits with fixed income accounts on Monday and plans to wrap up today in London, Boston and New York. Deutsche Bank, Goldman Sachs, JPMorgan and Santander are managing the meetings for the Aa3/A/A+ bank. Santander Brasil was in the market last week with a $550m reopening of its 4.625% 2017 bonds, getting a 4.30% yield.
CAF Eyes Sterling, USD
Regional development bank Corporacion Andina de Fomento (CAF) is heard considering a return to the dollar or sterling markets, according to a buyside source who was briefed on the multilateral lender’s plans. The supranational is heard considering a new 10-year USD in addition to gauging fixed-income investor appetite for a new sterling issue. “If they issue in sterling, CAF will probably have to pay another 15bp over the fair basis swaps level to get a transaction in sterling as there is an illiquidity premium attached to sterling issues though it is a high quality single A,” says the investor. Deutsche Bank is one of the banks heard working with CAF on the process. Bankers away from the process say that while CAF’s dollar bonds are performing well in the secondary – its 2022 bonds were trading at 3.30% Monday afternoon – it makes sense for CAF to diversify its investor base even if it has to pay up. “Sure the sterling market is more expensive than the dollar markets, but CAF can’t continue issuing in USD. It behooves them to look at other currencies even at a bit more of a cost,” says one banker. CAF took advantage of a recent ratings upgrade to raise CHF300m ($313m) in the Swiss market in early August. The multilateral lender’s director for financial policies and international issues, Gabriel Felpeto, told LatinFinance last month that CAF continues to analyze the USD, EUR, GBP and JPY markets, and did not rule out more CHF bonds before the end of 2012 as it seeks to diversify its funding sources. CAF is rated Aa3/A+/A+.
Cemex Completes Debt Exchange
Investor participation in Cemex’s debt exchange has reached 92.6% of existing exposures as of the September 7 deadline, it says, shy of its self-imposed 95% target but still enough to successfully extend maturities of $7bn in debt due 2014. In the operation, holders could exchange their existing exposures for three classes of new debt due 2017 and new 9.5% bonds due 2018. As the demand for the 2018 bonds exceeded a $500m cap, creditors who elected to receive new notes after the July 19 early deadline will be allocated approximately 54% of the amount they elected to receive, with the balance of their exposures allocated to the other classes involved in the exchange – new 2017 loans paying Libor+525bp, new 2017 USD private placement notes paying 9.66%, and new 2017 yen-denominated private placement notes paying 7.735%. The interest rates on the loans and private placement notes reduce over time, based on prepayment targets. The 2018 bonds are callable in 2016 and guaranteed by more than seven Cemex units. Participating creditors receive an exchange fee of 80bp, and a 50bp additional cash fee if the Cemex ADS exceeds $14.50 during the 90 days after April 1, 2015. As part of the proposal announced in June and launched in July, Cemex plans to make a $1bn paydown in 2013. If it misses the payment, the debt maturity reverts to 2014. It expects to fund the pay-down with asset sales, including minority stakes in Cemex operations in select countries, selected US and European assets and other non-core assets. A plan to raise at least $750m-equivalent through an IPO of its ex-Mexico assets is also in the works. BBVA and Citi are heard having been hired so far to manage the sale, for which the timing is unclear.
Colombian Considers Bond Markets
With an eye on continued growth in infrastructure opportunities in Colombia, Construcciones El Condor could consider issuing a bond of up to $100m in the next two to three years, Alejandro Correa Restrepo, its director of investment, tells LatinFinance. Colombia has a need for continued growth in construction as it relates to infrastructure, with a rising interest in improving road conditions and other forms of transportation, he says. The company will carefully evaluate the opportunities ahead, as it looks to sign on to projects the government is now structuring to allow private companies to propose infrastructure projects. It could also choose to proceed using its own funds, he adds. The builder completed its IPO earlier this year via Bancolombia raising COP162.58bn ($92m).
Colpatria Eyes Domestic Bonds
Banco Colpatria could look to issue COP100bn ($56m) in subordinated bonds in Colombia’s domestic market, with the ability to upsize to as much as COP150bn, say sources familiar with the Colombian lender’s plans. The notes are expected to be sold October 5, and will most likely have a 10-year maturity and be IPC-linked. Colpatria, rated AAA on a national scale, is heard to be self-leading the sale. The upcoming issuance is not yet rated, through its most recent subordinated sale got an AA+ mark. In that sale in February, Colpatria issued COP150bn in 10-year subordinated notes paying inflation plus 4.64%.
CFR Eyes Domestic Issue
CFR is expected to issue in Chile’s domestic bond market before the end of the year, assuming stable conditions, according to sources familiar with the Chilean pharmaceutical company’s plans. The issuer has registered an issuance of up to UF4m ($190m), with tranches of up to 10 and 30 years. It would be the Chilean pharmaceutical company’s first bond issuance. Proceeds could be used for planned M&A activity. IMTrust and Santander are managing. CFR is rated A+ on a national scale.
Colombia’s Popular Set to Issue
Banco Popular will look to issue COP250bn ($139m) in Colombia’s domestic bond market, with the ability to upsize to as much as COP400bn, according to a source familiar with the transaction. In the sale expected September 19, the Colombian bank can choose from fixed-rate 18-month, 2-year, and 3-year tranches as well as a 5-year inflation-linked tranche. Popular will self-lead the deal, rated AAA.