Maverick Tube Corporation, a part of the Tenaris group, has closed a $350m, 3-year amortizing syndicated loan, according to sources familiar with the matter. The deal pays Libor+225bp The oversubscribed transaction included participation from 11 banks. Santander and Standard Chartered were senior MLAs, with Natixis and Wells Fargo as MLAs. Credit Agricole, Citi, JPMorgan, Bank of Tokyo-Mitsubishi and Itau were joint bookrunners, Scotia acted as Co-Arranger and Banco do Brasil was a participant. The deal is backed by Tenaris’ Hydril Company, which was acquired in 2007. Tenaris acquired US-based Maverick in 2006.
Category: Regions
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Colombian Still Mulling Domestic Issuance
Colombian power company EPSA has extended its COP900bn ($505m) program until 2015, though it has not yet set a timeline for issuing the remaining COP300bn in bonds or commercial paper, says a person familiar with the company. The funds are to be used for investment, working capital and the replacement of other debt. EPSA, rated AAA on a national-scale, issued the program’s first COP600bn in April 2010.
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Fitch Lowers LatAm Units of Spanish Banks
Following downgrades of the Spanish parents, Fitch has taken action on certain LatAm Subsidiaries of BBVA and Santander, it says. The agency lowered the outlook to negative from stable on the credit ratings of BBVA Bancomer (A minus), BBVA Continental (BBB+) and BBVA Colombia (BBB). Fitch has lowered Santander Brasil to BBB from BBB+ and Santander Mexico to BBB+ from A minus, both with negative outlooks. It also lowered the outlook on Santander Chile (A+) to negative from stable. The BBVA and Santander parents had each been lowered to BBB+ from A.
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Holcim Prices MXP Sale
The Mexican unit of Switzerland’s Holcim has issued MXP2.5bn ($179m) in fixed and floating rate bonds in the domestic market. A MXP800m 2016 bond came at TIIE+67bp, and a MXP1.7bn, 2019 priced at a fixed rate of 7.0%, or Mbonos+170bp. The deal saw demand of MXP3.8bn, according to people familiar with the sale. The longer tenor drew demand from pension funds and insurance companies, and the shorter tenor attracted mutual funds, insurance companies, banks and retail investors. Proceeds are to be used to refinance the cement maker’s debt. Banamex, BBVA, and Santander handled the transaction, rated AAA on a national scale. Today, Mexico’s Volkswagen Bank plans to sell MXP1bn ($71m) in domestic 2016 bonds, expected at around TIIE+40bp area.
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Belize Bondholders Form Committee
A steering committee and ad-hoc group of at least 10 bondholders representing approximately $200m in Belize bond debt has formed to engage the government to review any possible amendments concerning external debt, specifically the country’s 2029s. “Any proposed amendment that results in a net present value or principal loss to creditors would not, based on the committee’s current understanding of the situation in Belize, be considered acceptable or, for that matter, necessary,” says AJ Mediratta, partner at Greylock Capital Management and chairman of the committee. Belize on March 19 issued a public statement announcing the commencement of a comprehensive and urgent review of its external public sector debt and contingent liabilities. Belize says it has appointed a debt review team and has retained external advisors to support the process of preparing comprehensive fiscal and macro projections, and identifying debt management alternatives. Called “super bonds” as they represent at least 40% of GDP, Belize’s 2029s were trading at 53 in price Wednesday afternoon. S&P has downgraded Belize’s long-term sovereign ratings to CCC+ from B minus after the country’s Prime Minister Dean Barrow raised debt service as an election issue. Moody’s has downgraded Belize’s credit rating to Ca from Caa1.
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Costa Rica Targets Bond Return
Costa Rica is looking to place its first international bond since 2004, most likely a $500m 10-year, though it could be authorized to issue up to $1bn. “It could take about 30 days for congress to approve issuance of debt. We could come to market in a few months,” says Luis Lieberman, Costa Rica’s vice president. The Baa3/BB+/BB+ sovereign awaits the green light from legislators for the issuance of $4bn in dollar debt over the next 10 years. Once approved, the sovereign is expected to start the RFP process. It is thought that Guatemala’s recent $700m 2022 bond issue can be used as a comp. Last month, Guatemala priced a $700m 10-year to yield 5.875%. Considered a better credit than Guatemala, it is thought Costa Rica could print inside the 5.875% level, pricing as tight at 5.5% say market participants. Costa Rica is looking to lower its government deficit to 0% of GDP in the next 3-4 years, and is turning to low interest rates in the international debt market as one avenue to do that. It has $250m coming due in March 2013. Panelists at EMTA’s Third Annual Central American & Caribbean Forum in New York say Costa Rica represents a growth story. It boasts 4%-5% annual growth, while several other Central American and Caribbean nations are expected to see 0%-2% growth rates, as well as and rising debt to GDP levels. “Costa Rica stands out as an outlier in the region. So Mr. Vice President, when thinking about your deal, think long term investors that want to grow exposure in Emerging Markets. Think about working with more than one dealer and issue a benchmark size issue,” says Katherine Renfrew, managing director at TIAA-Cref. “When issuing in the international capital markets, issuing a benchmark size is attractive,” adds Sean Newman, portfolio manager at GE Asset Management.
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Caribbean Development Bank Cut
S&P has lowered the credit rating of the Caribbean Development Bank’s to AA+ from AAA, as its risk management has weakened. “CDB has failed to comply with one of its internal liquidity policy guidelines, and borrower concentration remains high,” the agency says. S&P expects that the bank’s financial profile will remain stable, with new capital subscriptions offsetting lower profitability seen this past year and that it will remain so in the near future. The outlook is stable.
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Braskem Gets BNDES Credit
Braskem and Idesa have been approved for a $700m credit line from BNDES to pay for the construction of the Braskem Idesa – Etileno XXI project in Veracruz, Mexico, Braskem says. The credit is for construction plus 14 years, and Braskem declines to disclose additional details. The joint venture between the two petrochemical companies is building a $3bn petrochemical complex expected to begin operation in 2015, with a capacity of 1m tons per year.
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Holcim Set for MXP Bond
The Mexican unit of Switzerland’s Holcim is scheduled to issue today up to MXP3bn ($217m) in the domestic bond market. The guaranteed notes can be divided between 5-year floating rate and 10-year fixed rate tranches. The issuer is said to be looking at TIIE+65bp-75bp for the floating portion, and perhaps Mbonos+170bp-180bp for the fixed. Proceeds are to be used to refinance the cement maker’s debt. Banamex, BBVA, and Santander are handling the transaction, rated AAA on a national scale. Penoles had also been considering today for a $200m-$240m in 10-year dollar-denominated domestic sale. The deal through Banamex, BBVA Bancomer and Santander is expected next week.
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America Movil Ups KPN Stake
Mexican telecom America Movil (AMX) has spent EUR102m ($127m) to purchase 14m ordinary shares in Dutch telecom KPN at a cash price of EUR7.80-EUR7.85 per share, it says, levels lower than the EUR8.00 it is offering to holders in an offer launched in May. The series of transactions revealed Monday and Tuesday brings AMX’s holding to 7.86%, or 112.5m shares, it says in a statement. KPN, which hired Goldman Sachs and JP Morgan to advise it on its alternatives, is heard to be considering spinning off its Belgian and German units to dodge the hostile bid, which KPN finds too low. AMX is offering to buy an additional stake of up to 22.9% of KPN to bring its stake as high as 27.7%, through June 27. The move could cost it $3.25bn total. KPN shares closed Tuesday at EUR7.86.