The Colombian unit of Spain’s Gas Natural is planning a domestic bond sale, it says. The gas provider has been approved for up to COP500bn ($282m). A spokeswoman says no additional details of the transaction or of the timing have been determined.
Category: Regions
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GNB Finishes Roadshow
Colombia’s Banco GNB Sudameris has finished its investor meetings in the US, Europe and Latin America. No official details have been announced, but the bank is expected to emerge early this week with an international bond. A 10-year subordinated Tier 2 bond is expected, according to ratings agencies, perhaps at up to $500m. Bank of America Merrill Lynch is managing the process. The proposed 144a/RegS transaction is expected to be rated Ba1/BB+. Last month, GNB agreed to buy HSBC’s operations in Colombia, Uruguay, Peru and Paraguay, for $400m, and subsequently received authorization to issue subordinated cross-border bonds.
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Vesta Clinches Debut Equity
Mexico’s Corporacion Inmobiliaria Vesta has priced an IPO of at least MXP3.36bn ($254m), coming at the bottom of its price range. Vesta priced the shares at MXP19.00 each, according to a banker on the sale, versus a MXP19.00-MXP21.00 range. This would indicate a MXP3.36bn base deal, and MXP3.87bn size if the issuer placed all of the 203.8m shares available, including overallotment options. The industrial real estate specialist’s sale had been pushed back one day from Wednesday at the request of regulators, but was oversubscribed. The sale was aided by a preference for the real estate sector and the general bullishness on Mexico that has emerged this year, investors say. The total included 37.9m secondary shares sold by by members of the founding Corona family and other investors. Vesta plans to use 75% of the proceeds for the construction of new projects and the remainder for acquisitions. Credit Suisse and Santander managed. The developer is in 11 Mexican states and specializes in light manufacturing and distribution facilities.
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Peruvians Seen Seeking $300m
Corporacion Azucarera del Peru (Coazucar) is targeting $300m for its planned 2022 bond sale, Fitch says while assigning a BB rating. The sugar and ethanol unit of Grupo Gloria is on the road in Europe, the US and LatAm through July 25, with a BB/BB+ 2022 bond expected to follow. Bank of America Merrill Lynch and Citi are managing the process. A deal would offer a continued test of high-yield corporate appetite in the region. Coazucar operates 5 mills and 8 distilleries located in Peru, Ecuador and Argentina, crushing 8.4m tons of sugarcane per year. Fitch highlights Coazucar’s position as the largest sugar producer in Peru, a low cost structure, and high operating margins, as well as adequate liquidity and an improved capital structure. On the downside, the agency notes its 90% product concentration in sugar and the earnings volatility inherent to a commodities business.
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Chevron to Provide Loan for Vene JV
PDVSA and Chevron have agreed to terms for a $2bn financing for their Petroboscan joint venture, PDVSA says. The US oil producer is providing “long-term” loan at a rate of Libor+4.5%. It does not state the exact tenor, but says the last payment is scheduled for 2025. Petroboscan, operated by the two since 2006, plans to use the proceeds for increasing oil production in the Boscan oil field. The parties involved did not respond to request for additional comment.
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Credito Real Prices Local Issue
Mexico’s Credito Real has sold MXP500m ($38m) in domestic floating rate bonds. The 2015 note pays TIIE+280bp, with proceeds marked for general corporate purposes. The deal saw private banking and bank treasuries participating, with the spread coming in the midrange of the price talk, according to a person familiar with the transaction. BBVA Bancomer and Banorte-Ixe led the deal, rated A/A on a national scale.
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HY Passes Test with ICA Bond
Mexico’s ICA has raised $350m in the bond market, booking about $2.4bn in demand and demonstrating that appetite exists for LatAm high-yield credits. The sale, upsized from $300m, represents the first non-FIG corporate bond from a LatAm high-yield issuer since early May, and the first from Mexico since March. The builder and engineer priced the 2017 NC2.5 at 99.002, with a 8.375% coupon, to yield 8.625%, the tight end of 8.750%-area guidance, which followed wider 9%-area talk. The new B1/B+ bond was up 0.8- 1.0 points in the aftermarket Thursday, according to traders. Buyers were drawn in with the early 9.0% levels, seen as cheap for a 5-year, particularly considering the strong new issue market at the moment. At the much tighter final level, the bonds still appeared to be attractive. “Nobody is dropping out. People are searching for yield anywhere they can get it,” says a New York-based portfolio manager looking at the deal. The bonds compare to the 9.1%-9.3% yield seen on ICA’s outstanding 2021 bonds prior to launch, though working out a new issue premium from that level is difficult. Lead managers suggest the sale came flat to the issuer’s curve. ICA plans to use proceeds to refinance existing debt. Bank of America Merrill Lynch, Deutsche Bank and Goldman Sachs managed the sale, guaranteed by the Constructoras ICA, Controladora de Operaciones de Infraestructura and Controladora de Empresas de Vivienda units. LatAm had not seen a pure corporate high-yield bond sale since Inmet Mining’s $1.5bn 2020 and Ajecorp’s $300m 2022 in the first half of May.
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Repsol Exits Chilean Gas Distributor
Repsol has sold its subsidiary Repsol Butano Chile, which held a 45% stake in Chilean gas distributor Lipigas, for about $540m, it says. The sale cuts Repsol’s debt by $317m and results in a net capital gain of $170m for the company. For the last few years, Repsol has been selling non-core assets in LatAm to focus on vertically integrated operations and free up cash for exploration and production. Also, the company is working to protect its investment grade status following a downgrade after YPF’s nationalization. A Repsol spokesperson declines to disclose advisors used in the transaction. It is part of a wider EUR4.5bn ($5.49bn) disposal program for 2012-2016, of which it has sold off EUR2bn so far.
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Mexico Expected to Hold Rates
Mexico’s Central Bank is expected to hold its benchmark interest rate today at 4.5%. Many analysts see a long hold, with Citi estimating a 25bp increase only by June 2013. Goldman Sachs points to the June meeting’s more neutral tones. “The forward guidance turned more neutral inasmuch as the MPC eschewed the previous conditional/qualified easing bias.”
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BCP Wraps up DPR
Banco de Credito del Peru has completed the sale of $465m in bonds backed by diversified payment rights (DPR), it says, getting a larger size and distribution than is typical of the asset class in LatAm. A $150m 2017 with a 3-year average life portion pays a spread to Libor, and a $315m 2022 tranche pays a fixed rate. A manager on the deal declines to provide additional comment on the pricing. Standard Chartered and Wells Fargo are managing the sale, rated A/A.