Brazilian retailer Lojas Americanas has agreed to sell BRL293m ($178m) in 2017 convertible debentures to government development bank BNDES. The bonds to be purchased by the BNDESPar unit pay a fixed rate of 13.15%, and are convertible at a BRL19.25 per share price at any time. Americanas has also taken out a BRL442m credit line with BNDES. The retailer plans to use the new funds for its organic expansion plan.
Category: Bonds
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MBono Syndicated Auction Set for Wednesday
Mexico has scheduled its MXP25bn ($2bn) MBono auction for Wednesday. The 2031 bonds come with a coupon of 7.20%. The government began selling some of its domestic bonds through this type of larger syndicated sale in 2010 with the aim of allowing a large offering in one fell swoop rather than having to build outstanding size incrementally through a series of auctions. The bonds also qualify for inclusion in key indices and draw in a broader group of investors.
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Peru Retap on the Horizon?
Bankers are heard pitching Peru to reopen its 2050 bonds, in a move that could lock in historically low yields much like Mexico did in its August century bond retap, according to market participants. Investors say there is demand for yield and duration, making it sensible for Peru to retap the 2050s. A recent upgrade to BBB from BBB minus by S&P, may have also brought the sovereign one step closer to issuing debt in the international markets. While it is expected the sovereign will favor a local-currency trade, in July it filed to issue up to $5bn in new debt securities with the SEC. It remains to be seen what the sovereign would decide in terms of size, tenor and timing if it opts to issue in the dollar market, bankers say. “With low USTs both a retap and a new 10-year would work,” notes a DCM banker. The republic originally sold $1bn in the 2050s last year, along with $1.5bn-equivalent in retapped sol-denominated 2020s. As of Friday afternoon Peru’s 2050s were quoted at 106.75 or at 5.29% on a yield basis.
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Bladex Closes Upsized Syndication
LatAm supranational bank Latinoamericano de Comercio Exterior (Bladex) has closed a $165m 3-year loan syndication, bringing a total of 9 banks into the transaction. The deal was upsized from an original $150m target after margins were set at Libor+110bp. Leads were heard offering 90bp fees for tickets of $15m or more, 75bp for tickets of between $10m-$14m and 60bp for tickets of between $5m-$9m. Mizuho and Chang Hwa Commercial Bank jointly arranged the facility, with the former acting as bookrunner and the latter as MLA. BBVA and First Commercial Bank later came in as MLAs, Bank of Taiwan and the Export Import Bank of the Republic of China as arrangers, with Land Bank of Taiwan, Mega International Commercial Bank and Hua Nan participating as senior managers. Proceeds are going toward refinancing existing facilities taken out in 2009.
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Chileans Hold on Local Offerings
Poor market conditions have forced Chilean borrowers Grupo Saesa and Entel to delay local bond transaction that had been set to price on Thursday. Saesa is now aiming to issue a UF2m ($94m) bond next week if conditions allow, according to bankers on the sale. The electricity holdco had been eyeing 30-year bonds paying a coupon of 3.35% as it looks to refinance existing debt. BBVA Chile and IMTrust are managing the sale, rated AA on a national scale. Less is known about the fate of Entel, which elected not to price up to UF5m ($235m) in domestic bonds on Thursday, say market participants. No rescheduling has been announced, they add. The telecom had been looking to select among a 5-year CLP-denominated tranche paying a 6.1% coupon, a 5-year UF portion paying a 3.2% coupon and a 21-year tranche with a 3.5% coupon. Bice and IMTrust are managing the sale, rated AA minus on a national scale.
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Copec Plots Domestic Bond
Chilean fuel and forestry conglomerate Empresas Copec plans to raise up to UF1.5m ($71m) through the issuance of 2021 bonds in the local market. It will chose among two series, a UF-denominated tranche with a 3.25% coupon and a CLP-denominated tranche paying 6.25%. Timing has yet to be announced, but a company official says the deal could take place as soon as next week. Santander is managing.
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Cresud Poised to Price as Book Grows
Cresud’s book size was heard north of $50m Thursday afternoon, nearly covering the total $60m amount sought in the international markets by the Argentine agribusiness company. The RegS only 2014 bonds are expected to price today if market conditions permit. The agribusiness and real estate company wrapped up roadshows Thursday in Santiago, Chile after keeping official guidance in line with whispers at 7.5% area. Cresud is raising funds to refinance its debt. As of March 31, the company had $167m in standalone debt of which 50% is short-term. Itau is managing the sale, rated B.
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Transelca Aims for October Pricing
Colombian power transmission firm Transelca plans to sell COP180bn ($100m) in domestic bonds in October, says a company official. The unit of ISA will select from among 7-15 year maturities that will be priced either over inflation or the DTF benchmark rate. Proceeds are marked for debt management and for working capital. Correval, Bancolombia and BBVA are leading the sale, rated AAA on a national scale.
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Odebrecht to Meet Fixed Income Accounts
Brazil’s Construtora Norberto Odebrecht plans to meet fixed income investors starting Monday via Credit Suisse, Deutsche Bank, and Goldman Sachs. The Baa3/BB+/BBB minus issuer starts in London, before heading to New York and Chicago on Tuesday and wrapping up in Boston and Los Angeles on Wednesday. Currency, size and tenor for a potential bond offering have not been disclosed. Odebrecht last visited the dollar market in March, when it issued $500m in 2023 bonds via BAML and HSBC.
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Panama Politics Challenge Growth Story
Despite strong economic performance Panama could continue to underperform due to political troubles, analysts say. This was highlighted by the row that may see the departure of Finance Minister Alberto Vallarino. Vallarino and other cabinet members have threatened to quit over the firing of the country’s foreign minister. Juan Carlos Varela, who also holds the position of vice president, was fired as foreign minister after the President accused him of dedicating too much time to his plan to run for president in 2014. Vallarino, Varela, and the others who threatened to quit are from the Panamenista party, a junior coalition partner with the President’s party. “With the latest political news, we think Panama is likely to continue underperforming its high grade peers,” Nomura says, noting it had been expecting a convergence to neutral. Citi, however, says these political events should not have a significant short-term effect on asset prices.