Brazilian concession operator EcoRodovias is preparing to sell at least BRL800bn ($396m) in domestic bonds, it says. EcoRodovias is raising funds to prepay existing debt and for working capital. The company does not give additional details on the planned maturity or pricing, and did not respond to a request for comment.
Category: Bonds
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Energisa Readies Perp Buyback
Brazil’s Energisa has received board approval to move ahead with a repurchase of its perpetual bonds, it says. The Brazilian electric distributor is looking to buy back the 9.5% coupon senior perpetual NC5s issued in January 2011. Energisa plans to repurchase the $200m principal at the cost of 101% of face value, plus interest incurred up to the buyback date, amounting to $202m. The bonds were trading at 105-106 Monday in price, according to a trader. Bank of America Merrill Lynch, Morgan Stanley and Santander managed the original issue, rated Ba2/BB minus. Energisa is the holding company for five electric distributors in the states of Paraiba, Sergipe, Rio de Janeiro and Minas Gerais.
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Markets Await Cemex Results
Cemex is expected to announce the results of its offer to creditors as soon as today, following Monday’s deadline, as it seeks to extend maturities of $7bn in debt to 2017 from 2014. In a process launched last month, the Mexican cement maker is offering lenders an exchange of their current exposure into one or more of new 9.5% 2018 bonds, new loans paying Libor+525bp, new USD private placement notes paying 9.66%, or new 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 proposed 2018 bonds are capped at $500m, 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 US$14.50 during the 90 days after April 1, 2015. The offer is contingent upon acceptance from creditors representing at least 95% of existing exposures.
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Bachoco Advances Local Bond
Mexican poultry producer Industrias Bachoco has set an August 29 pricing date for a MXP1.5bn ($114m) transaction that would be its first in the domestic bond market. The notes will pay a spread to the TIIE, and have a tenor of 5 years. The deal is expected to be rated AA/AA+ with proceeds destined to refinance existing debt. Banamex is leading the transaction. Industrias Bachoco operates poultry production and distribution facilities throughout Mexico. Aside from breeding, processing and marketing poultry, it also produces and distributes eggs, swine, and animal feed. Last year it acquired privately-held Arkansas-based poultry producer OK Industries for $95m.
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Bancoldex Plans Domestic Issue
Colombia’s Bancoldex plans to issue COP350bn ($192m) in the local bond market on September 6, with the ability to upsize to COP700bn. The development bank can choose from 18-month, 2-year and 3-year tranches, and will self-manage the sale, rated AAA, with a group of other brokerages.
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Brazil DCM Key for Banks in 2H
While banks push to bring more ex-Brazilian issuers to the cross-border bond market in September, those who are present in Brazil’s domestic DCM – or would like to be – are also seeing that space as a priority to increase overall volume in the rest of the year. Local issuance remains strong due to a lower interest rate environment luring more issuers to market. Bankers see this change as structural and able to stand up to any struggles Brazil might have ahead on the macroeconomic front. “DCM markets continue to be much better than last year due to the activity coming from local markets. There is a big appetite for local credit in Brazil. Some times with lower spreads than at other times, but you always have a local market. It is different from the international market that can close,” says a senior Sao Paulo-based banker. “The local markets are strong, not only Brazil, but Mexico and other countries as well. That is something that is here to stay, as more companies get the alternative of funding in local currency, the local markets will take advantage of that,” says a New York-based DCM banker aiming to gain more volume locally. Larger issuers who are able are opting for Brazil’s local markets, such as Telefonica Brasil, who has approved the sale of up to BRL2bn ($990m) in domestic bonds. The operator of the Vivo brand plans a 2017 bond paying DI+0.75%. It is raising funds to invest in its 4G network, and repay local debt. It does not indicate manager of the sale, to be done under the rule 476 restricted format, and the company does not respond to a request for comment. Developer Cyrela is planning to sell BRL400m, it says. The 2017 debenture is expected to pay the DI rate plus 1.20% and amortize in two equal parts in each of the final two years. Proceeds will be used to repay debt. Caixa Economica Federal is managing the sale, rated Aa2 on a national scale and done under the rule 476 restricted format. Through August 17, there had been BRL8.31bn completed in the ru
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Facileasing Sets MXP Target
Mexico’s Facileasing plans to issue up to MXP750m ($56m) in the domestic market, according to a regulatory filing. The 3-year floater will pay a spread to the TIIE and will represent the second issuance under a MXP10bn program. In February, Facileasing priced a MXP500m 2015 at TIIE+70bp, marking the fleet leasing company’s first bond offering since being acquired by BBVA Bancomer. BBVA Bancomer is managing the new sale, rated AAA on a national scale.
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YPF Moves Ahead with Bond Upsize
Argentina’s state-controlled oil and gas company YPF plans to ask for approval to expand its debt program by $2bn, it says, and will put the matter to a shareholder vote September 13. The authorization would come in addition to the $1bn for which it is already authorized. Faced with large capex needs, YPF has indicated it plans to sell up to ARP3.5bn ($760m) in bonds, targeting the domestic market. YPF had earlier this year been considering an international bond, but is said to prefer a local issuance given conditions in the international markets, as well as likely difficulties approaching international investors in the wake of the company’s nationalization earlier this year.
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BBVA Peru Hits the Road
Peru’s BBVA Continental plans to meet bond investors in Europe, Latin America and the US next week. The BBB/BBB+ rated lender will visit accounts beginning in Santiago and Lima on Monday, followed by visits to Los Angeles and New York Tuesday and Boston and London on Wednesday, before wrapping up in Switzerland Thursday. In June, BBVA Continental received authorization to issue up to $800m in the international bond market, with potential to issue as much as $500m in 10-year bonds and $300m in 4-year bonds. The sale would allow Continental to match assets with liabilities and diversify its funding base. BBVA, Bank of America Merrill Lynch and Goldman Sachs are managing the process. Continental’s last visit to the debt capital market was a $500m sale in January, pricing at par to yield 5.75%, with BBVA, Goldman Sachs and JPMorgan managing. Continental’s 2017 and 2020 bonds were trading at 3.7% and 4.8% in yield Thursday, respectively, according to a trader. FIG issuance from LatAm looks to be a strong theme when activity resumes in September. Brazil’s Caixa Economica Federal is heard mandating Deutsche Bank, HSBC and Bank of America Merrill Lynch and Panama’s Global Bank is heard looking to begin a roadshow ahead of a possible covered bond reattempt. Banco do Brasil is also expected to resume plans to issue a yen-denominated bond.
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Renova Readies Local Debt
Brazil’s Renova Energia is preparing a BRL300m ($149m) debenture sale in the domestic market, it says. The issuance may be divided in up to nine tranches, ranging from 2-10 year maturities, and pay up to 123.45% of the DI. Proceeds are marked for the generator’s investment plan and for general corporate purposes. Banco do Brasil is managing the sale, done under the rule 476 restricted format. The sale was initially contemplated in June, to go along with a BRL315m equity investment from BNDES.