Category: Bonds

Argentine Banco Hipotecario has made a tender offer to buy back 10 of its Series Notes of US dollar and euro-denominated debt that remained unrestructured after its debt swap program of two years ago. The Bank will pay 108% of the principal amount of the notes tendered but will not pay any additional accrued but unpaid interest or past due interest on the notes. The tender offer expires on July 31. Citigroup Global Markets is acting as the dealer manager for the offer.

Colombia is to buy back up to $950 million worth of local-currency debt within the next 90 days. The move aims to reverse what the government describes as “inefficiencies in [the local] bond curve”. Colombia has increased the proportion of its peso-denominated debt to foreign-currency debt this year to protect against exchange rate fluctuations.

Brazilian Companhia Vale do Rio Doce (CVRD), the world’s largest iron-ore producer, is to buy back 47.9 million of its preferred shares, representing about 5% of its stock in circulation. CVRD said its decision to launch the buyback program was prompted by the recent share price performance and difference between its common and preferred share prices. Meanwhile, the company managed to stare down Chinese steelmakers to agree a 19% price increase for iron ore following tough negotiations.

The Brazilian government plans to buy back foreign currency bonds it considers the market is valuing too cheaply. Treasury officials are eyeing bonds maturing in 2020 and 2030 because yields on these issues are higher than other outstanding debt, distorting the sovereign yield curve.

Brazilian internet retailer Submarino is to buy back up to 10% of its stock, comprising around 5.13 million shares. The shares closed the day Tuesday at $15.36. The buyback is being coordinated by Credit Suisse, Banco Santander, Banco Itaú and Banco Pactual.

Panama is to buy back all its outstanding Brady bonds next month, taking advantage of a call option on July 17. The $352 million bonds in circulation comprise four series. Panama is following a now, well-trodden path in the region to improve its debt profile. Earlier this year Brazil announced its multi-billion dollar Brady buyback plan; Venezuela was due to buy back $3.9 billion of Bradies by the end of last month and Colombia announced it would spend $4.3 billion on repurchasing the paper this year.

Ecuador is to buy back its outstanding 2012 bonds by January, ahead of the new government assuming power. There are currently $510 million of the 2012 bonds, the sovereign’s most expensive debt, in circulation. Last month the government bought back $740 million of the 12% bonds to save an estimated $20 million a year in debt payments. Ecuador is likely to tap the international bond market later this year; the government has been authorized to issue up to $900 million of new debt.