Bancolombia has sold COP800bn ($450m) in 5 series of new domestic bonds, exercising the maximum COP200bn overallotment after demand hit COP2.03trn. A COP246.12bn 2013 tranche pays the IBR+1.58%, a COP87.65bn 2014 pays IBR+1.70%, a COP100.56bn 2018 pays DTF+4.05%, a COP117.63bn 2021 pays DTF+4.25%, and a COP248bn 2026 pays DTF+4.60%. All 5 types came inside of the maximum spreads by 12-30bp thanks to high demand. Bancolombia managed the sale, rated AAA on a national scale. Thus far in 2011, the local bond issuance in Colombia has come almost entirely from the financial sector, and more is on the way. Helm Bank (COP200bn), Banco Falabella (COP150bn) and Banco Finandina (COP60bn) are all planning deals that should price in August.
Category: Bonds
Posted inDaily Brief
Camargo Subs Close Tender
Holders of 70.9% of Caue Finance’s 2015 bonds and 55.2% of Loma Negra’s 2013 notes have accepted tender offers that expired Monday. Each also received holder approval to eliminate restrictive covenants.” Holders of $106.3m in Caue’s 8.875% 2015 bonds and $55.2m of Loma Negra’s 7.25% of 2013 bonds had accepted the offers as of the July 26 expiration. For each $1,000 in principal holders of the 2015s and 2013s got $1,750 and $1,070, which include a tender premium of $165m and $60 respectively. After the early bird, holders were offered a lower $1,165 and $1,060. The companies are indirect subsidiaries of Brazilian conglomerate Camargo Correa. BAML was sole dealer manager.
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Minerva Convert Uncertain Amid Market Pain
The fate of a convertible debenture sale from Brazil’s Minerva was unclear Wednesday evening, after the issuer extended the bookbuilding period by one day and sought to set a price Wednesday night, targeting BRL300m. The results were expected by this morning for what has been touted as the Brazilian market’s first-ever public sale of mandatorily convertible debentures, which was heard struggling to fill order books as risk markets continued to sour. “In this market nothing is getting done. There is zero international money going into Latin America,” says an ECM banker away from the deal. The volatility is due not only to concerns about debt problems in the US and the euro-zone, but also to increased worries about the domestic picture in Brazil, he adds. Equity transactions from Copersucar and Union Agriculture Group have been pulled in the last week, and Abril Educacao priced below its range. Minerva is looking at a reoffer price of between 97.00-103.00 of face value, with the interest rate and conversion price range established prior to bookbuilding. The bonds are to pay interest at 100% of DI, with the minimum and maximum conversion prices set at BRL6.00 and BRL8.00, respectively. Proceeds are marked for the repayment of existing debt, and for working capital. Minerva is rated BBB minus on a national scale. Goldman Sachs, Deutsche Bank and Banco do Brasil are leading. Officials at the company and the lead managers did not comment or did not return requests for comment Wednesday.
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Nextel Mexico Gets CDB Loan
Nextel Mexico, the operating subsidiary of NII Holdings, has signed an agreement with China Development Bank for a $375m loan. The loan will fund the purchase of Huawei Technologies’ 3G network infrastructure. The financing has a final maturity of 10 years with a 3-year drawdown and a 7-year repayment term. The company did not return calls regarding the rate of the loan.
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NR Finance Prices Floater
Mexico’s NR Finance priced MXP2.5bn ($215m) in 3-year floating rate bonds in the domestic market, coming at TIIE+50bp, or 5bp tight to guidance after generating MXN3bn plus in demand. Pension and mutual funds were the principal buyers. The Nissan leasing subsidiary was expected to price last month but halted plans to issue after regulators required more time to enquire about guarantees from the parent. With regulations becoming more stringent across Latin America, greater transparency is being sought from issuers in an effort to protect and encourage pension fund participation in bond issues, bankers say. NR Finance plans to use the funds for working capital. HSBC and Scotia managed the sale, rated AAA from Fitch on a local scale. The borrower last came to market in November 2010, when it issued MXP2.8bn in 3-year bonds, priced at 65bp over TIIE.
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Elektra Preps Pricing After Releasing Guidance
Mexican Retailer Elektra is out with guidance of 7.5% area on a $350m RegS 7-year NC4, falling in line with earlier investor estimates of 7%-8% and coming at the tight end of mid-to-high whispers. Books are closing this morning and pricing is expected as soon as today. By early Wednesday leads were receiving sufficient orders to hit the$350m target, and while some international investors have been somewhat ambivalent about the credit, locals are thought to like a name that is well known in Mexico. Accounts from Latin America, Asia and Europe are also heard to be showing interest. At 7.5% area, pricing is seen as fair from a relative value perspective with some eventual upside in secondary trading. “For new issue liquidity or some diversification, do it,” writes one trader. “But it doesn’t light my fire tremendously. More campfire than bonfire.” As comps this trader was looking at Mexican financial names such Financiera Independencia and Credito Real, which have 2015s trading at 7.9% and 8.0%, as well TV Azteca’s 2018s which have been quoted at around 7.1%. Whether TV Azteca will be able to come at the tight end of the 7.5% area is still a matter for debate, with some investors already drawing a line at the level. “If it is tightened below 7.5%, we will not participate,” notes a European bond investor who has both TV Azteca and Mexican retailer Famsa in his portfolio. Famsa 2015s have been trading at around 8%. Investors are told the company plans to use $250m from bond proceeds to finance debt with the remainder for capex plans. The unsecured notes have a BB Fitch rating. BCP, Jefferies and UBS are leads.
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AES Gener Preps New Issue
Chile’s AES Gener could price a new 5.25% 2021 as soon Thursday as it looks to retire $400m in outstanding 7.5% 2014s. The electricity provider is offering the 2021s or cash to holders of the 2014s. Investors who opt for new bonds will receive $1,000 in 2021s plus $150 in cash per $1,000 principal of existing bonds if tendered prior to July 27. Thereafter, they will receive new bonds plus $110 in cash as long as they tender before the final deadline of August 10. Holders choosing cash will get $1,130 per $1,000, and have only until July 27. Gener is also separately tendering for its local 8.0% 2019 bonds in a domestic offer. Fitch has put an up to $475m size on the new issue after rating it BBB minus. The offer is contingent upon a minimum $200m overall acceptance to the USD tender, as well as Gener successfully issuing enough new 2021s to cover costs associated with the cash portion of the USD bond tender and the local bond tender. Citi and Deutsche Bank are acting as dealer managers.
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Brazilian Oil Co Gets Local Funds
Petra Energia, a Brazilian oil producer in the Amazon region, has completed the sale of BRL320m ($209m) in 2013 debentures in the domestic market. The bonds pay interest at the DI+6.25%. BTG Pactual managed the sale, done under the rule 476 restricted format. Petra owns and operates oil reserves in the Parnaiba basin.
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GBM Seeks Domestic Financing
Grupo Bursatil Mexicano, the Mexico-based brokerage firm, plans to issue up to MXP1bn ($86m) in floating rate bonds on August 18. Proceeds will be used to rollover about MXP200m in maturing bonds carrying rates of TIIE+50bp and +25bp, as well bank credit lines. The self-led bonds have not been rated. In May, GBM announced plans to raise funds for infrastructure investments through a certificado de capital de desarrollo (CCD).
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Renner Closes BRL300m Bond
Lojas Renner has raised BRL300m ($188m) through dual-tranche issue in Brazil’s local bond market. The retailer’s BRL215.1m 2016 amortizes equally in years 4 and 5 and pays the DI+1.1%, coming in under a DI+1.35% ceiling. A BRL84.9m IPCA-linked 2017 pays a fixed 7.8% rate and amortizes equally in years 4, 5 and 6. Renner is raising funds to optimize its capital structure, with a view to having sufficient liquidity to carry out its organic expansion plans. Santander managed the sale, rated AA+ on a national scale. The transaction is one of the few Brazilian domestic bond deals done in the rule 400 format, rather than the restricted-format rule 476 provision, which have accounted for the great majority this year.