Brazil’s Rio Grande Energia has become the latest CPFL unit to raise domestic bonds, closing a BRL500m ($243m) sale, according to Anbima. The 2019 pays DI+0.80% and amortizes in equal parts during the final three years. Caixa Economica Federal managed the sale, done under the rule 476 restricted format. Last week, CPFL Piratininga raised BRL110m and the CPFL parent raised BRL660m.
Category: Bonds
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Itau Adds Asian Greenshoe
Itau has added $125m to the $1.25bn 2022 Tier 2 bond priced on Monday, exercising a greenshoe option during Asian hours. The extra portion saw $800m in demand and boosted the outstanding size of the deal to $1.375bn. The Brazilian bank had priced the unsecured subordinated bond at par with a 5.500% coupon, to yield at the tight end of 5.500%-5.625% guidance, revised from mid to high 5%. Itau, JPMorgan and Standard Chartered managed the Baa2/BBB rated transaction.
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Metro Preps Securitization
The Dominican Republic’s Metro Country Club is preparing a $150m 2019 securitization, according to Fitch, which assigns a B minus rating to the deal. The developer is said to be starting a roadshow today expected to visit the US, Europe and LatAm, with an aim to close the transaction the week of August 13. The deal with a 3.5-year average life will be backed by flows related to the sale and operational revenues from the Las Olas, Marbella, Costa Blanca and Metro Country Club projects. Proceeds will be used to refinance $75m in existing debt, as well as complete current projects and fund the acquisition of land for new ones. Bank of America Merrill Lynch is managing the process, done through the MCC Finance SPV.
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Nafin Ready for Domestic Bond
Mexico’s Nacional Financiera is expected to price up to MXP2bn ($150m) in 10-year bonds today in Mexico’s domestic market. The transaction is expected to price at MBonos+50bp area, according a source familiar with the process. Banamex and HSBC are managing the transaction, rated AAA on a national scale.
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Wind Project Bonds Set Price Targets
The Oaxaca II and IV wind projects indirectly owned by Spain’s Acciona have emerged with yield guidance of 6.5%-area for bond transactions expected as soon as this week, according to sources following the process. The two 144A/RegS senior secured transactions are seeking respective $164.5m and $167.5m 2031 bonds, each with an average life of 13 years. Pricing is being viewed in terms of a spread to the project’s offtaker, Mexico’s state-owned CFE , whose 2021 and 2042 bonds were quoted at respective 3.20% and 4.90% yields Tuesday. The roadshow for what would be the region’s first wind project bonds ended last week. BBVA, BNP, Credit Agricole, Santander and Societe General are managing the deals, each rated BBB minus.
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AMX Pushes Sterling Limits, Retaps USD
America Movil (AMX) continues to fuel up on debt at attractive levels, raising $1.92bn through a GBP-denominated sale and reopening of the 10 and 30-year bonds sold earlier this month. The Mexican telecom raised GBP750m ($1.17bn) in 2041 bonds, pricing through its dollar curve and offering the region’s longest and largest sterling issuance to date. Gathering funds as it plots expansion in Europe, AMX took advantage of attractive issuing conditions to build a GBP1.8bn book. The bond priced at 97.828 with a 4.375% coupon to yield 4.511%, or Gilts+165bp. The A2/A/A minus rated issuer priced inside its dollar curve, according to a source familiar with the transaction, spotting the level at the equivalent of Libor+165bp. The 2042 dollar bonds AMX reopened Monday at UST+153bp came at the equivalent of Libor+186bp. Proceeds are marked for general corporate purposes. Deutsche Bank managed the sale. The transaction tops a Petrobras GBP700m 2026 sold in December and AMX’s own GBP650m 2030 bond in 2010, according to Dealogic data. The 29-year tenor beats the 25-year bonds issued by Barbados in 1990 and Trinidad in 1984. Not finished for the day, AMX moved on to bring its haul to nearly $2bn with the tightly-priced reopening of the pair of dollar bonds. The 3.125% coupon 2022s reopened for $350m at 102.623 to yield 2.820%, or UST+131bp, at the tight end of mid-130bp-area guidance. The 4.375% 2042 bonds reopened for $400m at 104.601 to yield 4.106%, or UST+153bp, at the tight end of UST+mid-150bp-area guidance. Said to generate more than $2bn in orders, the retaps offered little new issue premium by pricing flat to inside pre-announcement secondary levels seen the AMX 2022 (UST+130bp) and 2042 bonds (UST+157bp). “America Movil is a solid company with a healthy balance sheet, but we didn’t see value in the retap,” says an EM investor who opted out of the trade. “People need a place to put money and AMX is the bluest of the blue chips,” says a banker away from the deal. Proceeds w
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Contax Approves BNDES Debt
The board of Contax Participacoes, an outsourcing operator that counts Oi among its controlling shareholders, has approved the issue of BRL253.4m ($138m) in domestic bonds, Contax says. A BRL126.7m 2018 inflation-linked tranche pays 6.5% and is convertible in to shares after two years at the holder’s discretion. The conversion price is BRL32.00 per share, or the stock’s 22-day trading average plus a 50% premium, whichever is less. The shares closed at BRL21.51 Monday. A second tranche is identical in size and tenor, but is not convertible into equity and pays the TJLP+1.5%, tightened from an originally planned TJLP+2.5%. Contax plans to use proceeds to execute its 2011-2013 investment plan. BNDES is managing the sale, and its BNDESPar arm has agreed to purchase the bonds.
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Itau Lands Tier 2 Debt
Itau has emerged to raise $1.25bn in 2022 Tier 2 bonds, drumming up around $3.3bn in orders. The Brazilian bank priced the unsecured subordinated bond at par with a 5.500% coupon, to yield at the tight end of 5.500%-5.625% guidance, revised from mid to high 5%. The bonds traded up 0.375 points in the grey Monday afternoon, according to an investor. Itau offered 25bp concession versus pre-announcement levels on its outstanding 2022 Tier 2 bonds, seen at 5.25% yield. “The deal is fair given that the issuer was pretty conservative from the start,” says a banker away from the sale. The sale follows a similar $1.25bn 2022 Tier 2 sale in March. Beginning January 2013, banks will no longer be allowed to issue under the current Tier 2 format. Itau chose to issue a new 2022 for this reason, according to a source close to the sale, seeing the possibility to issue a larger size via a new bond than through a retap of the 2022s. Monday’s issuance is similar in structure, size and maturity minus a few months. Over 200 accounts participated, with a mix of private banking and institutional investors, according to sources familiar with the deal. The issuer has an option to exercise up to 10% greenshoe during Asian hours. Proceeds will be used to strengthen the bank’s capital structure and for general corporate purposes. Itau, JPMorgan and Standard Chartered managed the sale.
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Petrotemex Hits Majority in Tender
Mexico’s Petrotemex has received consent from holders representing $154m of its 9.50% 2014 bonds, it says, following Friday’s early acceptance deadline. The amount represents a majority. The Mexican petrochemical company is offering holders $1,100 cash per $1,000 principal amount tendered. Holders who tendered by the early date receive an extra $30. In the offer expiring August 10, the company is also soliciting consents to amend the indenture relating to the existing notes, eliminating all of the company’s restrictive covenants. JPMorgan is managing the process.
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NaFin Close to Domestic Funds
Mexico’s Nacional Financiera, the development bank, is looking to issue up to MXP2bn ($151m) in fixed-rate 10-year notes Wednesday. Banamex and HSBC are managing the transaction, rated AAA on a national scale.