Colombia’s ISA is watching the domestic market in hopes of selling a bond before the month ends. Size and details must still be finalized, according to a company official, and the issuer is able to sell COL641bn under its debt program. Citi, Corredores Asociados, Correval and Interbolsa are managing the sale.
Category: Regions
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PacRu Hits the Road
Colombia’s Pacific Rubiales plans to meet bond investors in Canada, the US, Europe and LatAm starting next week. The Ba3/BB borrower will see accounts beginning November 7 in London, and visit New York and Santiago Tuesday, Boston and Lima Wednesday, Los Angeles, Bogota, and Paris Friday, before wrapping up in Bogota and Switzerland on Saturday. Bank of America Merrill Lynch (BAML) is managing the process. One of Latin America’s largest private oil and gas companies, Pacific Rubiales has principal operations in Colombia, Peru and Guatemala. It last issued a bond in November 2009 when it priced $450m 8.75% 2016 bonds to 8.95% yield via BAML and Citi. Fitch upgraded Pacific Rubiales to BB from BB minus Thursday.
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NROCC Brings Rare Single B Bond
Jamaica’s National Road Operating and Constructing Company Limited (NROCC) priced a $294.18m 2024 bond Thursday after generating some $400m demand, marking the first single B credit to hit the market in quite some time. Proceeds are going to take out 8% notes due 2012. With some solid anchor orders behind it, the 144a/RegS bond was able to price and close within a matter of hours, coming at par to yield 9.375%. Interest came from both Caribbean and dedicated EM accounts, who were comping against the sovereign and Air Jamaica bonds. The sovereign’s 2019s and 2025s were trading around 7.25%-7.50% and 8.25% area. “The market is still choppy. With a low single B credit you need to come out with some critical anchor interest from local accounts,” says one banker. The B3/B minus credit comes with a 100% guarantee from the Jamaican government. Credit Suisse was the sole bookrunner and Oppenheimer & Co. was co-manager on the transaction. The bonds have a 13-year life with 12.5 average year life. The notes are redeemable in whole or in part by the issuer at a make-whole premium of T+100 basis points.
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Investors Flock to New ICE Bond
Instituto Cosarricense de Electricidad (ICE) dived directly into pricing on its $250m 10-year Thursday after investors flocked to the rare credit, helping leads build a book that reached around $2bn in size. Whispering low to mid 7s earlier this week, leads essentially closed the books on Wednesday after receiving healthy demand and skipped guidance yesterday to launch and price at par to yield 6.95% or 488bp over UST. Viewed simply on its spread differential to the sovereign, ICE’s new bond was seen as extremely attractive to some investors who were also drawn to the credit’s rarity value, and quickly pushed the bond up close to 4 points in the after market. Some shops had the sovereign’s 9.995% 2020s trading Tuesday at 4.88%-4.71% on a yield basis, or at UST+272bp, making for an alluring spread differential. Leads, on the other hand, were heard spotting the same bonds at 285bp-305bp, calculating that a new sovereign 10-year would come at 315bp-335bp and putting the spread to ICE’s new bond at around 163bp. Other sovereign-to-quasi differentials vary from country to country, and from credit to credit. For instance, in Brazil, quasi sovereign utility Eletrobras 5.75% 2021s have been trading with 185bp differential, while in Colombia the spread is around 165bp for a credit like EPM. Assuming Costa Rica was penalized somewhat against its other quasi peers for not being eligible for index inclusions, leads were heard calculating a 10bp-30bp new issue premium. Citi and Deutsche Bank managed the sale, rated Baa3/BB+, the issuer’s first cross-border deal since 2004.
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Bancolombia Sells Local Jumbo
Bancolombia has sold COP600bn ($315m) in 4 series of local bonds, seeing total demand of COP1.28trn. A COP127.3bn 2014 tranche pays DTF+1.85%, a COP132.8bn 2019 tranche pays IPC+4.10%, a COP115.8bn, 2023 tranche pays IPC+4.45%, and a 2026 COP224.1bn tranche pays IPC+4.62%. Bancolombia self-led the sale, rated AAA on a national scale. Banco Popular and ISA are expected to follow this month.
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Panama Hydro Secures $155m Loan
Panama’s Bajo Frio hydroelectric project has signed a $155m 15-year term loan to help fund construction. Netherlands Development Finance Company (FMO) and Norwegian DnB Nor are mandated lead arrangers for the financing, and will lend $47.5m each to the project. French development financer Proparco will provide $35m, and Germany’s DEG, $25m. The interest rate was not disclosed. A person familiar with the deal calls the transaction competitively-priced, noting that it would be unlikely to be able to get the same pricing in today’s market. The Bajo Frio project is owned by Panama’s Fountain Intertrade, a joint venture between Norway’s Agua Imara and Panama’s Credicorp Group via their subsidiaries SN Power ACA Holding and Panamá Hydroelectric Ventures, respectively. It has an expected cost of $224m.
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Colombian Microlender Preps Local Bonds
Colombia’s Bancamia is planning to issue up to COP400bn ($211.5m) in local bonds. The interest rate and tenor and manager of the bond have not yet been disclosed. A person familiar with the sale expects it to come before the end of the month.
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EEB Clinches Call Funds
Empresa de Energia de Bogota (EEB) has priced a $610m 10NC5 bond, essentially meeting its funding needs to call its existing 8.75% 2014 bonds. The Baa3/BB+ Colombian utility priced at par to yield 6.125%, or UST+406.4bp, coming in line with 6.125%-6.25% guidance and low 6% whispers. The bonds jumped up 1.8 points in the grey ahead of pricing, according to an investor. Empresas Publicas de Medellin’s (EPM) 7.625% $500m 2019s, considered a direct comp, were trading slightly below 5% Thursday. The deal was seen coming 75bp wide to EPM, though one investor estimates a 40bp premium to EPM considering the rating differential and the two-year tenor extension. The sovereign’s own 10-year bond had been trading at 3.57% Thursday. Deutsche Bank and Santander were leads. Last month, EEB has also launched a COP700bn ($360m) equity follow-on and is expected to upsize the deal to about COP770bn.
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Sacyr Gets Chilean Road Loan
Spanish Construction company Sacyr Vallehermoso has reached a EUR276m ($379m) financing agreement with Chile’s Corpbanca to fund construction of a pair of motorways. Sacyr has a 35-year contract for the Bio-Bio and Rutas del Desierto concessions. Both parties decline to comment on the loan’s interest rate or maturity.
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Tuscany to List in Bogota
Tuscany International Drilling, the Canadian-based and listed E&P company, is to list its shares in Bogota, but does not plan to place any new stock through the operation. There is no indication of timing.