Banco del Estado de Chile has become the first Chilean bond issuer in Japanese yen, raising JPY24bn ($253m) in a Euroyen transaction. The 2018 bond priced at par with a 0.837% coupon, to yield mid-swaps plus 35bp, in line with 30bp-40bp guidance. The price comes inside the bank’s USD curve, helped by what people following the deal describe as a very favorable swap environment for LatAm issuers. Aa3/AA minus/A+ Banco Estado was seen pricing 19bp back of the JPY bonds of Sweden’s Nordea (Aa3/AA minus/AA minus) and 16bp of Dutch Rabobank (Aa2/AAminus), when Estado’s USD bonds trade some 60bp back of the pair’s dollar notes. “Banco Estado blazed the trail for Chilean issuers into the JPY market, achieving exceptional pricing, the lowest 5-year yield on record from Latin America, and well below even JBIC-guaranteed issuance for LatAm borrowers,” Chris Gilfond, co-head of Latin America credit markets at Citi, tells LatinFinance. “A turning point for Latin American issuers is to find a market where it could price inside its dollar curve, and Estado is a clear leader here,” says another person following the transaction. Citi and Daiwa managed the sale. The deal follows a $200m reopening of Banco del Estado’s 2017 USD bond in May. Banco do Brasil raised JPY24.7bn though a Euroyen bond transaction last year in September, the last pervious LatAm yen sale. Euroyen – a yen-denominated bond issued by a non-Japanese company outside of Japan – represents an alternative format to the Samurai yen-denominated bonds that various LatAm issuers have used in recent years. The deal was one of the few getting done in LatAm during the last two weeks, with many issuers waiting for better dollar market conditions. Brazil’s Banco Pine is meeting investors in Geneva and Zurich today ahead of a potential CHF100m ($107m) Swiss Franc debut with a 3-year or 5-year maturity. Banco do Brasil and Odebrecht are also waiting for an opportunity, the former planning a euro-denominated bond and the later a
Category: Japan
Mexico Visits Samurai Buyside
Mexico is visiting Japanese credit investors this week through Wednesday, according to people familiar with the process. The issuer has indicated previously that a Japanese sale would likely be among its borrowing this year. The sovereign is heard considering 5 and 10-year bonds. Daiwa, Mizuho and Nomura are managing. A deal would follow Banco del Estado de Chile’s JPY24bn ($253m) 2018 bond priced late Monday, the first LatAm yen bond of the year.
Japanese Telecom Specialist Partners with Brazilian
Japanese manufacturer Oki Electric Industry has agreed to acquire a 70% stake in Brazilian electronics company Itautec’s automation and services business for BRL100m ($49m), Itautec says, as Oki looks to grow in emerging markets. Buying into the unit – spun off from Itautec, will give Oki, a telecommunications specialist, access to a growing Brazilian ATM industry. Itautec may receive additional payments if it meets certain business targets through 2015. The deal is expected to close before the end of the year.
Mitsui Enters Brazil Hydro Project
Japan’s Mitsui has agreed to enter the Jirau hydroelectric project in Brazil’s Amazon region, buying a 20% stake from GDF Suez in the ESBR Participacoes vehicle, the parties say, for about BRL1.14bn ($567m). The amount is based on a total BRL5.7bn value that GDF assigns to the entire 3,750 megawatt project expected to come online in 2015. GDF Suez bought a 9.9% stake from Camargo Correa last year, upping its equity in the project to 60% from 50.1%. After the Mitsui deal’s close, which is expected in the second half of 2013, subject to conditions and approvals, GDF Suez will have a 40% stake, with Eletrobras’s Chesf and Electrosul holding 20% each, as will Mitsui. Jiaru’s capex until completion was expected to be approximately BRL16bn as of December 2012. In 2009, the project agreed to a BRL7.2bn 25-year financing package from the BNDES, with BRL3.635bn directly from BNDES and BRL3.585bn via a group of Brazilian banks. The project, under construction on the Madeira River in the state of Rondonia, currently has 30-year power purchase agreements contracting for 73%, while the rest will go to shareholders.
Mazda Mexico JV Closes Financing
Mazda Motor Manufacturing de Mexico, a joint venture between Mazda and Sumitomo Corporation, has closed a $320m, 7-year term loan, according to sources familiar with the sale. Funds will be used for building a new factory in Mexico. Sumitomo Mitsui was bookrunner on the deal, with participation from Hiroshima Bank, Mitsubishi-UFJ, Mizuho, Shizuoka Bank, Sumitomo Mitsui Trust, and Yamaguchi Financial. Their terms of participation were not disclosed.
Japanese Group Closes Brazilian Offshore Loan
The Cernambi Norte project has closed on a $1.17bn financing package, according to people familiar with the transaction. The deal includes a $700m, 19-year JBIC-funded tranche paying Libor+150bp and a 19-year, $468m commercial bank tranche paying Libor+250bp. Bank of Tokyo-Mitsubishi, Mizuho, Sumitomo Trust, Sumitomo Mitsui, and Mitsubishi-UFJ participated in the commercial tranche. The SPV owned by Japan’s Modec, Mitsui, Marubeni and Mitsui OSK is raising funds to develop the Cernambi Norte oil fields off the coast of Brazil.
Japanese Insurer Adds in Brazil
NKSJ has increased its stake in Brazil’s Martima Seguros, it says, at a cost of BRL200m ($98m). The Japanese insurance group acquires 37% of Maritima’s common shares and 21.8% of its preferred shares, to bring its total holding to 87% of common shares and 92.1% of preferred shares. Through its Yasuda Seguros unit, it bought the shares from members of the Vidigal family. NKSJ first bought a position in Maritima in 2009. The deal is subject to regulatory approvals and expected to close by May.
Mitsui Buys into Mexican Wind Farm
Mitsui has agreed to acquire a 50% stake in EDF’s Bii Stinu Mexican wind energy project, it says. The 164 megawatt farm in Oaxaca has a total project cost of MXP5.1bn ($399m), though Mitsui does not state the exact amount its MIT Renewables unit is to pay. The project is scheduled to begin operation in June, and has 15-year power purchase agreements with Arcelor Mittal Steel Lazaro Cardenas, Walmart Mexico, Grupo Modelo, Grupo Herdez and Continental Automotive Guadalajara.
Petrobras, Peru Get Japanese Funds
Following the recent IMF meetings in Tokyo, Petrobras has come away with up to $1bn in funding from the Japan Bank for International Cooperation (JBIC), and Peru’s government has agreed to receive loans totaling $156m from the Japan International Cooperation Agency. Brazil’s state-controlled oil company is to receive up to $1bn for energy projects, it says, with up to $600m coming directly from JBIC and up to $400m lent by Bank of Toyko-Mitsubishi with partial JBIC guarantees. Petrobras claims the agreement will represent JBIC’s largest energy efficiency financing to date, and is a first for Petrobras in terms of a large contract for a project of this sort. A spokesperson was unable to provide additional details. Separately, Peru has agreed to a $100m-equivalent loan supporting renewable energy, and a $56m-equivalent loan destined to help fund solid waste management, according to the government. Funds will pass through Peruvian development bank Cofide, with an eye toward benefitting environmental protection. Further transaction details were not disclosed, and the government declines to comment.
AMX Files Yen Shelf
America Movil has filed a 2-year JPY150bn ($1.91bn) bond shelf in Japan, according to a source familiar with the filing. There were no immediate details of any first issuance. Bank of Tokyo, Mizuho are the banks working on the process. The Mexican telecom sold its first yen-denominated bond last year, raising JPY12bn in the Samurai market. Mitsubishi UFJ-Morgan Stanley and Mizuho managed that sale, which included a 3-year JPY6.9bn yielding 1.23% and a 5-year JPY 5.1bn yielding 1.53%. AMX is rated A2/A/A, and also has an A rating from Japan Credit Rating Agency.