Embratel Heads Off USD Maturity

Brazil’s Embratel has launched a BRL400m issue of 180-day promissory notes paying 118.5% of DI. The telecom provider – which is controlled by Mexico’s Telmex – plans to use proceeds to pay off $178.8m in 11% coupon dollar bonds issued in 2003 that mature December 15. Caixa Economica Federal is managing the sale, which follows several Brazilian corporates’ use of the promissory note market, most recently Telemar’s BRL2bn in 1-year to complete the purchase of Brasil Telecom. Embratel’s investment-grade rival secured funding at DI plus 3%.