Category: Chile

Chile’s E-CL has joined the list of LatAm issuers looking to tie up deals before year-end, raising $400m in 2021 notes. The company, formerly known as Edelnor and controlled by GDF Suez, drew $1.25bn in orders on the BBB minus rated bonds, according to bankers on the deal. The 5.625% coupon priced at 98.432 to yield 5.832%, or UST plus 260bp, the tight end of UST plus 260bp-270bp guidance. The bond traded 30bp tighter in the aftermarket, according to investors. One US-based investor says the issue is cheap relative to comparables such as the Chile sovereign issue and Codelco. Deutsche Bank and JPMorgan managed the sale, which follows a US and European roadshow and is the first dollar bond for EC-L/Edelnor since 1998, according to Dealogic.

Chilean power company Compania General de Electricidad (CGE) is planning to issue up to UF2m ($89m) in 21-year bonds via a Dutch auction as early as Friday, says a banker off the deal. Proceeds of the AA minus/A+ notes will be used to refinance debt. BBVA will lead the issue. Another banker says the issue is comparable to that of Inversiones Electricas del Sur, another power utility, which issued UF4m in 21-year notes with a coupon of 4.00% yielding 4.05% and priced at 99.33, a spread of 78bp over BCU-20. IMTrust and BBVA led that sale.     

Chile-based retailer La Polar is planning to issue up to UF5m ($222m) in local bonds in 2 tranches, according to a banker off the deal. One tranche will be due in 10 years and the other in 25, the banker says. Another banker off the deal says the 10-year notes could have a spread of around 120bp over the BCU benchmark and the 25-year notes a spread of around 100bp. A banker on the deal says that a roadshow might begin later this week. Proceeds of the A minus rated notes will be used to refinance debt and to fund investments. BBVA is leading the sale.

Chilean retailer Cencosud is heard planning 10-year dollar benchmark. The company has been assigned a BBB minus rating by Fitch and a Baa3 rating by Moody’s. The Chilean retailer has hired JPMorgan, Deutsche Bank and Santander for a deal expected next year, according to DCM bankers. Though Cencosud is a frequent issuer in Chile’s domestic market, a dollar deal would be a debut in that format, according to Dealogic. The Fitch rating comes from Cencosud’s “dominant position in the retail business in Chile, a strong market position in Peru, Argentina, northeast Brazil, and a growing presence in Colombia,” the agency says in a report, noting a diversified business model including retail, real estate and finance, growing cash flow and improving liquidity. If conditions are adequate, Chileans could account for a decent part of new issuance next year. Paper producer CMPC and bank BCI have held road shows in the last few months. BCI pulled a dollar deal in September, but is heard to be considering a return to the dollar markets or a possible local issuance. Banco de Chile is also heard considering a dollar deal.

Chile’s E-CL, the power company formerly known as Edelnor and controlled GDF Suez, is meeting fixed-income investors today and tomorrow on a “non-deal” basis. It will visit London, Boston, Los Angeles and New York on the tour, led by Deutsche Bank and JPMorgan. BBB minus/B2 rated EC-L/Edelnor has not issued a USD bond since 1998, according to Dealogic.

IFH Peru, the holdco for Interbank, Supermercados Peruanos and other businesses, is preparing to add $100m to its 8.625% of 2019 bonds sold last year. It is targeting the Chilean and Peruvian institutional buyside and planned to meet investors in these countries before Tuesday’s expected pricing, according to a banker on the deal. The B+/Ba3 bonds were originally sold in October 2009, at an 8.750% yield, in a transaction upsized to $150m from $100m. Given the small size, the outstanding bonds are not frequently traded, though a banker on the deal spots them at 108.5. Proceeds from the retap will go to finance expansion at IFH’s subsidiaries. Barclays and IM Trust, which led the original sale, are managing the deal.

Itau Chile has issued UF1m ($44m) in local bonds, at 85bp over the BCU-5 benchmark. The price is inline with expectations held by bankers off the deal, who had been forecasting a spread of 80bp-85bp. The AA minus 3.00% coupon bonds priced to yield 3.54%. The issue was 1x oversubscribed, according to a banker on the deal, who says the book consisted of local pension and mutual funds. Proceeds will be used to extend credit to clients. Itau Chile managed the sale itself.

Signing on Banco Itau Chile’s $150m 2-year syndicated loan is expected soon, though it is waiting for a Taiwanese lender, according to a banker with knowledge of the transaction. The deadline had been expected November 23 and was later moved to November 26. The transaction is heard to be oversubscribed. HSBC, RBS, Wells Fargo, Commerzbank, Citi, Bank of America, Credit Agricole and BNP Paribas are joint leads on the transaction. Proceeds will be used to lend to Chilean corporates. The spread offered is Libor plus 90bp.