Mexico’s Grupo Televisa has sold $600m in 2040 bonds to become the first Mexican corporate to issue at the long end of the curve this year. The media company upsized from an initially announced $400m on the back of some $1.7bn in demand. The issuer known for its penchant for long-dated debt priced the Baa1/BBB+ deal at 98.319 with a 6.625% coupon to yield 6.755%, or UST plus 245bp. The yield came inside of the UST plus 250bp-area guidance, which followed whispers of 250bp-260bp. Some buysiders say they felt squeezed by the spread tightening. “This priced with very little concession to the curve,” says a New York-based EM investor looking at the transaction. However, the bond tightened 2bp-4bp on the bid side in the aftermarket, according to investors. Proceeds are for general corporate purposes. A banker managing the deal notes the issuer has a comfortable cash position and is taking advantage of opportunistic market conditions. Credit Suisse managed the sale. Televisa was the second pure LatAm corporate to go long this year, following Vale’s $1bn 2039 offer in September. Its previous bonds include a 6% 10-year sold in May 2008, a 30-year Europeso issue done in 2007, a 20-year dollar bond in 2005, and a 30-year dollar bond in 2002, according to Dealogic.
Category: Regions
Arca Plans Local Bond
Mexico’s Embotelladoras Arca is planning a local bond, and aims to sell up to MXP3bn in fixed and floating rate notes, according to an S&P report assigning a AAA rating on a national scale. The tenor should be up to 7 years, S&P says, and proceeds should be used for refinancing debt. A banker on the deal says the bottler would like to price by mid-December. HSBC is managing the sale. In June, Arca sold MXP1.5bn in domestic bonds, including MXP1bn in 2012 notes at TIIE plus 100bp, and MXP500m in 2016s at a fixed 9.75% rate.
Peru LNG Taps Local Market
Peru LNG, the sponsor building a giant LNG liquefaction terminal in Pampa Melchorita, Peru, has sold $200m in bonds across 4 tranches on the local market in what lead banks are calling Peru’s largest domestic bond in 5 years. The bulk of the deal involved $135.3m of 15-year bonds featuring an average life of 7.3 years and a 5-year grace period, paying 6-month Libor plus 3.656%. It also sold $10m in 2.5-year bullet bonds paying 3.438%, $30m in 5-year amortizing bonds with a 2.7-year average life paying 4.656%, and $24.7m of the same15-year bonds, but paying a fixed rate of 7.156%. Total demand topped $560m, including $342m for the Libor tranche, according to a statement from sole manager Banco de Credito de Peru. “The [deal] included an innovative placement mechanism designed by BCP that consolidated the books for tranches 3 and 4, thus increasing competition in the longer segment of the bonds, especially between the two largest investor groups: private pension funds and life insurance companies,” says BCP in a statement. The $3.9bn Peru LNG project is the largest ever infrastructure undertaking carried out in Peru, and is expected to start operations in June 2010. Sponsors Hunt Oil, SK Energy, Repsol YPF and Marubeni had previously funded it with equity and $1.25bn in loans from development and commercial banks signed in 2008.
Bolivia to Get China Loan
The Bolivian government is close to getting a $60m loan from China to finance the installation of 100,000 residential gas connections, according to a statement from the local ministry of hydrocarbons. At least $31m of the facility will go to state-owned energy company Yacimientos Petroliferos Fiscales Bolivianos to acquire 2 drilling rigs. The loan will have a 20-year term and an annual interest rate of 2.0%. The deal still needs to be approved by the Bolivian Congress.
Colombia Rates To Stay Put
Colombia’s central bank is expected to keep its monetary policy rate at 4.0% today. Bank of America-Merrill Lynch says softer inflation, still sluggish economic activity and particularly a weaker COP suggest Banrep will continue to leave rates where they are. Morgan Stanley also expects the bank to keep the rate unchanged for the rest of the year. By the end of 2010, it estimates the rate will be increased to 5.5%.
Cayman Clinches Debut Bond
The Cayman Islands has priced its first international bond, raising a $312m 10-year note. The 5.950% yield came inside of 6.000%-6.125% guidance and is the lowest ever for a Caribbean sovereign, according to a banker managing the sale. The 5.950% coupon bonds priced at par and saw an order book of more than $1.2bn. About 80 accounts participated, according to a banker on the deal, with 40% from the US, 30% from Europe and 30% from other regions, mostly Asia. The Aa3-rated issuer is using proceeds to refinance short-term debt. HSBC managed the sale.
State of Mexico Set to Market ABS
State of Mexico (Edomex) is preparing a road show for next week to support a novel MXP4.3bn ABS transaction, according to officials working on the deal. The 20-year bonds will be backed by income from residential property titles, according to regulatory documents. An MXP3bn tranche will feature a guarantee from OPIC, and a MXP1.3bn tranche features a 30% first loss guarantee from CAF, in its largest-ever participation in a Mexican transaction. Both tranches are MXP-denominated, will pay a fixed interest rate and are expected to be priced in mid-December. MBIA subsidiary LCA is arranging, with MBIA providing re-insurance on about 32% of the first tranche. Banamex and HSBC are managing the sale. The deal is the first of its kind, according to officials, and could be replicated by other Mexican States.
Peru LNG Set for Domestic Issue
Peru LNG plans to sell up to $200m equivalent in bonds today on the local market. The consortium controlling the under-construction LNG liquefaction terminal 200km south of Lima can sell up to $10m in 2012s, up to $40m in 2014s, and up to $160m in 2024s, all paying fixed rates, as well as up to $160m in 2024 notes paying a spread to Libor. The bonds can be sold in dollars or soles, and the total across the tranches cannot exceed $200m. BCP is managing the sale, rated AAA on a national scale. The Peru LNG consortium is made up of Hunt Oil, SK Energy, Repsol YPF and Marubeni. The $3.90bn project has to date been financed with sponsor equity and $1.25bn in loans from development and commercial banks singed in 2008. The terminal is expected to start operations next year.
Inverargos Sells 7.3% of Cement Unit
Colombian holding company Inverargos says it has sold a 7.3% stake, or 83.8m shares, in Cementos Argos via the local stock exchange for COP842bn ($430.5m). Bogota-based equity research shop Bolsa y Renta says the company sold each share at COP10,040 and that sale reduces the seller’s stake in the cement company to 63.0% from 70.3%. In October the company had announced its intentions of selling 5.0%-10.0% in Argos to pay down debt. Argos shares closed Wednesday at COP10,240.
Colombia Returns to Samurai Market
Colombia has placed JPY45bn ($503m) in bonds privately with Japanese investors, according to the finance ministry. The 2019 Samurai issue was sold at par with a 2.42% coupon, for a yield 93bp over JPY swaps. A guarantee from JBIC boosts the rating to AA, and proceeds will help fund 2009 budget needs. Mitsubishi UFJ Securities and Daiwa Securities SMBC managed the sale. The last regional issuer to visit Japan was supranational CAF, which raised JPY10bn in 4.30% 2019 bonds in February.