PDVSA plans to swap 2011 bonds for 2013s in an offer to investors through November 12 and offer new 2017 bonds through the end of the week. The Venezuelan state-owned oil company will sell the $3bn worth of B+ 8.5% of 2017s at par in an offer through Friday. As with previous government offerings, the offer is directed at individuals and businesses with the “sector productivo nacional,” and investors will be allowed to buy the dollar-denominated bonds with Bolivars at a VEB4.30 per dollar rate. Results are set to be announced Monday. Separately, PDVSA will offer holders of its 6% 2011 bond new 8% 2013 bonds at an exchange rate of $1,125 per $1,000 if done by October 28, and $1,015 per $1,000 if done after. Citi is managing both processes.
Category: Venezuela
Posted inDaily Brief
BP Reported Selling Venezuela Assets
A BP spokesman declines to comment on statements by German Khan, CEO of BP joint venture TNK-BP, stating that his company would acquire several of the oil company’s assets in Venezuela. According to press reports, Khan told reporters TNK-BP would acquire 16.7% of Petromanagas, 40% of Petroperija and 26.6% of Bougeron. BP also declined to comment on the potential value of those assets, though they have been estimated at $1bn, according to an industry banker not associated with the deal. Khan has been looking for assets to acquire in LatAm, the banker says, but this is his first acquisition of oil assets on the continent. He had previously acquired non-oil & gas assets outside of Venezuela, the banker says.
Posted inDaily Brief
PDVSA Sells 50% of Ruhr Oel
PDVSA has agreed to sell a 50% stake in Ruhr Oel GmbH to Russian oil and gas company Rosneft for $1.6bn excluding PDVSA’s share of crude inventory and receivables to be valued at closing, according to the buyer. Ruhr Oel GmbH is a 50/50 downstream JV between BP and PDVSA with stakes in 4 German refining and petrochemical complexes. Venezuela’s national assembly has also approved a 60/40 JV between PDVSA and ENI Lasmo, a subsidiary of Italian oil company ENI to develop Junin Block 5. According to a statement from the national assembly, the block is expected to produce up to 240,000 barrels of super heavy crude a day.
Posted inDaily Brief
Venezuela, Argentina Get CAF Financing
Venezuela is getting 2 loans worth a total $700m from CAF, one for $600m to finance the Tocoma hydroelectric plant and the other, for $104m, to improve mass transit. CAF also approved a $500m loan for Argentina to be invested in an electric power line project. Terms were not released.
Posted inDaily Brief
PDSVA to Offer New Bonds, Swap
PDVSA says it will sell $3bn of 2017 bonds in the local market, with further details about the offer due October 18. As with previous government offerings, investors will be allowed to buy the dollar-denominated bonds with VEB. The offer is directed at individuals and businesses with the “sector productivo nacional” designation. The state-backed oil company also plans to offer holders of its 2011 bonds an opportunity to exchange them for 2013 bonds, with further details to be announced in coming days. PDVSA does not name banks, through Citi is rumored to be on the transaction.
Posted inDaily Brief
Venezuela Continues Nationalization Spree
The government of Hugo Chavez says it has nationalized oil lubricants firm Industrias Venoco, its subsidiaries and fertilizer company Fertinitro. The nationalization of the companies is being done to “reduce the prices of lubricants” as “PDVSA produces lubricant bases and then these private companies buy them and resell them at 4-5 times the original price.” Venoco officials could not be reached for comment. US-based Koch, which holds a 35% stake in Fertinitro, says it has not been told about the nationalization. Italy’s Snamprogetti holds a 20% in Fertinitro and Venezuelan state-run petrochemical company Pequiven holds 35%.
Posted inDaily Brief
FertiNitro Bond Pressure Lingers
Fitch says it is keeping the CCC ratings of Venezuela’s FertiNitro Finance’s $250m 8.29% secured bonds due 2020 on rating Watch Negative. Fitch expects rating pressure to remain through 2011, when the project reaches its maximum annual debt service requirement. The subsequent decline in debt service coincides with the maturity of bank debt separate from the secured bonds. Fitch notes that FertiNitro on September 28 made timely payment of $40.3m in semi-annual debt service. “Overall, FertiNitro continues to make progress since Fitch’s last review in March 2010 with improved operational performance, resulting in positive cashflow and a debt service coverage ratio of 1.98 times,” it adds. FertiNitro is expected to deposit over $36m to the debt service reserve fund after the October debt payment.
Posted inMagazine
Venezuela Investors Await Change
While some still make money under the radar in Venezuela, most foreign investors monitor politics for signs of an opportunity.
Posted inWeb Articles
Absorbing Extra Currency
Despite having one of the world’s richest oil reserves, Venezuela’s economy must still fight to overcome the effects of an overvalued currency and an unstable business environment.
Posted inWeb Articles
Down and Out of Fuel
Despite having one of the world’s richest oil reserves, Venezuela’s economy must still fight to overcome the effects of an overvalued currency and an unstable business environment.