Petrominerales has priced a $400m convertible bond sale, it says. The 3.25% 2017 bonds are convertible in to common shares at $18.0017 per bond, representing a 35% premium to Thursday’s closing price. The shares closed Friday at CAD31.04 ($12.54). The Toronto-listed Colombian oil producer is raising money to fund a tender offer, through which it is to buy back $250m of its 2.625% 2016 bonds, at a price of 98.5. The operation leaves $272m outstanding in the 2016s ahead of a 2013 call date. ABG Sundal Collier Norge managed both the sale and the tender.
Category: Bonds
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Triunfo Plots Local Bond
Brazilian infrastructure company Triunfo plans to raise BRL300m ($149m) in the domestic market, it says. It is looking for funds to replace existing debt, and does not give indications of pricing, tenor or timing. BTG Pactual has been hired to manage.
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BR Properties Readies Local Debut
BR Properties plans to raise BRL400m ($199m) in its first-ever domestic bond transaction, it says. The issue will have a 2017 tranche paying the DI plus up to 1.0% and an inflation-linked 2019 tranche paying up to 6.25%. The size and exact rate will be determined during the bookbuilding process, scheduled for July 13-26. Roadshows are scheduled to start June 18. The proceeds are targeted to repay short-term debt. Banco Votorantim, Bradesco, BTG Pactual, Citi, Itau and Santander are managing the sale, rated AA on a national scale.
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Brasil Foods Pulls Trigger
Brasil Foods has followed Guatemala into the bond markets this week, as the latest window of opportunity appears to have extended from sovereigns to investment-grade corporate borrowers. The Baa3/BBB-/BBB- food products company sold $500m in new 2022 bonds amid continued volatility in broader markets, getting $1.66bn in demand. Its first issuance as a high-grade credit priced at 99.070, with a 5.875% coupon, to yield 6.000%, in line with 6%-area guidance. The bond was heard trading up about 0.75 points Thursday afternoon. Brasil Foods was thought to offer 20bp-30bp concession, depending on where the existing 2020s were spotted and adjusting for the curve extension, according to investors and bankers following the transaction. “Coming out when the UST is at an all-time low paid off for Brasil Foods,” says an investor following the name. “They saw a window and jumped in. Phenomenal pricing versus local pricing, even at 6%,” notes a banker away from the deal. There were 170 accounts said to participate, with US institutional investors accounting for two-thirds. Banco do Brasil, HSBC, Itau and Santander managed the sale. If the deal continues to perform well, bankers say the window could remain open for other high-quality issuers. A recent upgrade gave Brasil Foods 3 of 3 investment-grade ratings, and the company has altered its structure through moves last year, including a regulator-mandated asset swap with Marfrig and a dairy acquisition. Brasil Foods closed a $500m dollar and euro-denominated loan facility last month, and its last previous international bond issuance was in 2010, raising $750m at 10 years through Itau, JPMorgan and Santander.
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Carozzi Preps Domestic Issue
Empresas Carozzi plans to issue up to UF3m ($130m) in Chile’s domestic bond market , likely at the end of June, says a person familiar with the sale. The Chilean food and agricultural products producer can choose between a 7-year UF bond with a 3.7% coupon and 2-year grace period, a 7-year peso bond with a 7.10% coupon and 2-year grace period, and a 20-year UF bond with a 4.1% coupon and a 15 year grace period. Banchile-Citi is managing the sale, rated A+/A on a national scale, with proceeds going to refinance liabilities. Carozzi last issued in April 2009, selling $126m-equivalent in 7 and 21-year inflation-indexed bonds on the domestic market, through BBVA.
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Mexico Clinches JBIC-Less Samurai
Mexico became the first BBB rated borrower to issue a Samurai bond without JBIC support, placing JPY80bn ($1bn) in 3-year and 5-year bonds in the Japanese market. The deal follows nearly two weeks efforts in Japan and comes nearly a year after sounding out Japanese investors in August 2011. The sovereign priced JPY50bn in 2015 bonds at par with a 1.29% coupon, to yield Yen Libor+89bp, and JPY30bn in 2017s at par with a 1.56% coupon, to yield Yen Libor+110bp. Each part landed at the tight end of price thoughts of Yen Libor+80bp-100bp for the 2015 and 100bp for the 2013. Issuance without JBIC support came at a price, with bankers away from the deal estimating at least 100bp over its dollar curve. “They must have gotten good demand from Yen investors because it came at a good spread over its dollar curve and there are definitely investors out there to put Yen to work,” notes a rival banker following the trade. Mexico initially had its eye on JPY40bn-JPY50bn in a 5-year or 10-year, but indicated it would be flexible on size and tenor depending on risk appetite among Japanese investors. It has until now sought longer maturities but with the aid of a JBIC guarantee, most recently selling JPY150bn in of 10-year bonds at a 1.51% yield, or Yen Libor+50bp, in October 2010. Falling into Mexico’s medium to long-term investment program, Japanese investors represent an increasingly important market and diversification alternative, after the USD and EUR bond markets. Juan Pablo Newman, Mexico’s general director of debt issuance, told LatinFinance earlier this month that higher costs are generally associated with entering new markets, but funding costs were expected to decrease over time. Citigroup, Mitsubishi UFJ Morgan Stanley, Nomura and SMBC Nikko managed the deal.
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Minerva Plans Debentures
Brazil’s Minerva plans to turn to the local bond markets for fundraising, it says, seeking a BRL420m ($208m) 2022. The meatpacker is looking for money to fund projects for the next 10 years. Pricing is to be determined during the sale process, and it does not yet name the banks. Officials at the company did not return requests for comment. In March, Minerva reopened its 12.25% of 2022 NC5 international bond for $100m, following a $350m sale in February. BTG Pactual, Goldman Sachs, Itau and Morgan Stanley managed those issuances.
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OAS Wraps Up Debentures
Brazil’s OAS has completed the sale of BRL300m ($149m) in the domestic debenture market, according to Anbima. The 2015 bonds pay the DI+2.4%, feature an 18-month grace period and are guaranteed by the Construtora OAS unit. Proceeds are destined to improve the builder and engineer’s debt profile. Bradesco managed the sale, done under the rule 476 restricted format and rated BBB on a national scale.
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Penoles to Raise Domestic USD Bond
Mexican mining conglomerate Penoles is preparing to sell $200m-$240m in dollar-denominated bonds in Mexico’s domestic market, according to regulatory filings. The 10-year fixed-rate notes have an expected pricing date of June 13. Seeking to match liabilities with USD cash flows, the miner plans to use proceeds to fund expansion and cost reduction projects as well as for general corporate purposes, says Moody’s, which assigns a national scale Aa1 rating. The notes will be guaranteed by the company’s principal subsidiaries, excluding Fresnillo, the agency adds. Banamex, BBVA Bancomer and Santander are managing the new deal, rated Aa1/AAA on a national scale. The Mexican miner last sold $530m in dollar-denominated bonds in Mexico’s domestic market in September 2010, pricing a $400m 10-year tranche 5.15%, and a $130m 2015 at Libor+178bp.
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Telecom Places Private Bond Facility
Columbus International has sold $82m in new 2017 bonds, under a senior notes facility that allows it to borrow up to $143m more on the same terms. The 9.5% bonds were placed with a single private high-yield fund, and no bank was involved, according to a company official. The Barbados-based Caribbean telecom operator may draw down additional amounts during the next year, and the notes are callable after 2.5 years. The proceeds will be used to accelerate the completion of current capital plans, fund potential future acquisitions, enhance balance sheet liquidity and flexibility and for general corporate purposes. “The new notes facility is credit negative to Columbus since it increases its leverage while free cash flow remains negative,” says Moody’s, which rates Columbus B2. Columbus’ leverage was 3.9x adjusted debt to Ebitda as of March 31, and the agency had expected it to be “well below” 4x. Columbus placed a $450m 11.5% 2014 international bond in 2009.