Chile-based financial institution Caja de Compensacion La Araucana has issued CLP10bn ($21m) in local 5-year bonds via a Dutch auction. The notes have a coupon of 7.00% and priced at 100.39 to yield 6.90%. They have a spread of 116bp over the BCP benchmark, tighter than the 120bp-140bp spread expected by one banker off the deal. Bankers on the deal say the company might seek another bond issue of the same size as demand for this week’s trade was 2x twice the amount offered. Proceeds of the A rated bonds will be used to refinance debt and to offer credit to clients. Itau Chile managed the sale.
Category: Chile
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Itau Chile Plans UF Issue
Itau Chile is planning to issue up to UF1m ($44m) in 5-year bonds. The issue is expected to take place Friday, say bankers on the deal. Proceeds of the AA minus notes will be used to extend credit to clients. Two bankers off the deal say they expect the notes to have a spread ranging between 80bp-85bp over the BCU benchmark. Itau Chile will handle the sale itself.
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Araucana to Issue Bonds Today
Chile-based financial institution Caja de Compensacion La Araucana is planning to issue CLP10bn ($21m) in local 5-year bonds via Dutch auction. Proceeds of the A rated bonds will be used to refinance debt and to offer credit to clients. Itau Chile will manage the sale. Bankers off the deal say it could price in an area similar to last week’s issue of financial services company Factorline, which issued CLP10bn in 4-year bonds at 122bp over BCP. “Araucana’s bonds could have a spread of around 120bp-140bp over BCP,” one banker says.
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Itau Chile Extends Loan Deadline
Banco Itau Chile extended the deadline on a $150m 2-year term loan facility it is syndicating, to give Asian lenders time to participate, according to a banker with knowledge of the transaction. The deadline was expected November 23, but was moved to November 26. The transaction is also heard to be oversubscribed. HSBC, RBS, Wells Fargo, Commerzbank, Citi, Bank of America, Credit Agricole and BNP Paribas are joint leads on the transaction. Bank meetings were last Wednesday. Commitments are expected and the deal will close early December. Proceeds will be used to lend to Chilean corporates. The spread offered is of Libor plus 90bp.
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Saesa, Araucana Plan Local Bonds
Chilean electricity transmission company Saesa and finance company Caja de Compensacion La Araucana are issuing local bonds, according to 3 bankers away from the deals. The bankers said both deals could price as early as Thursday. Saesa is planning a UF4m ($179m) 21-year bond that will be used to pay down previous debt. IM Trust is heard leading the issue. La Araucana is heard seeking a CLP20bn 5-year local issue to be led by Itau Chile out of a CLP45bn ($94m) shelf. In April, Chilean water utility Aguas Sandinas placed a UF1.75m 21-year yielding 4.08%. In August, financial services company Factorline issued CLP20.00bn ($40.00m) of 2015 that yielded 6.88%.
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Chile Tightens As Expected
As expected, Chile’s central bank tightened its rate by 25bp, bringing it to 3.00%. The bank says the local economy is enjoying robust growth while inflation is lower than expected and the local currency has remained stable. Celfin expects another 25bp increase at December’s meeting, bringing the rate to 3.25% by the end of the year. Morgan Stanley agrees, adding that it expects the rate to end 2011 at 5.50%
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Iansa Issues UF Bonds
Chilean agribusiness holding company Iansa has issued UF1.59m ($70.00m) in local 7-year bonds, getting slightly more than UF2.00m in demand, says a banker on the deal. The BB+ rated notes pay 4.14% over inflation. According to the banker, this was 149bp over the BCU-5 benchmark, in line with his expectations. A banker away from the deal had expected the deal to price around 150bp over BCU-5. The notes have an average duration of 4.7 years, the banker says. Proceeds will be used to pay down existing bonds and to refinance debt. Celfin managed the sale.
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ISA Considers Partner for Cintra
Colombian infrastructure company ISA will consider bringing in a partner to buy the 40% stake in Cintra Chile it does not already own, says a company spokeswoman. She adds that the search for a potential partner has not begun, as ISA’s option to buy the stake in the highway operator does not take effect until 2012. The company has not yet begun to consider financing options. ISA completed the acquisition of a 60% stake in Cintra for about $300m from Spain’s Grupo Ferrovial in September. Part of the acquisition will be financed with a $150m loan from BBVA and proceeds from a 2009 ISA share issue.
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Pricing Heard on Iansa Local Bond
Chilean agribusiness holding company Iansa plans to issue up to UF2m ($88m) in 7-year bonds today. A banker away from the deal says he expects the bonds to price at around 150bp over the BCU-5 benchmark, which is at 2.68%. The notes have a duration of 4.7 years, the banker adds. Proceeds of the BB+ rated notes will be used to pay down existing bonds and to refinance debt. Celfin is managing the sale.
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Chile Seen Hiking Rate
Chile’s central bank is expected to tighten its monetary policy rate by 25bp today to bring it to 3.00%. Morgan Stanley says that the hike will be due to the disinflationary impact of a stronger Chilean peso. Meanwhile, Celfin, which also sees a 25bp hike today, expects another 25bp increase in December’s meeting, bringing the rate to 3.25% by the end of the year.