CMPC Prints 10-Year in Choppy Market

Chile’s Empresas CMPC has sold $500m in 2019 bonds on the back of about $1.25bn in demand. The issue priced at 99.117 with a 6.125% coupon to yield 6.240%, or UST plus 275bp, the tight end of 275.0bp-287.5bp guidance. “This was a volatile environment, though the [US] GDP numbers gave the markets a bit of a boost,” says a banker on the deal, who notes investment grade credits are having an easier time dealing with the current market conditions, characterized by choppy equity and FX movements, than recent high-yield visitors. BNP, JPMorgan and Santander managed the sale, rated Baa2/BBB+/BBB+. Proceeds will help finance the $1.43bn purchase of the Guaiba mill from Brazil’s Aracruz. The company also aims to place 20m new shares at around $25 each to raise another $500m for the purchase. The remaining $430m will come from the company’s own cash. CMPC agreed in September to buy the Guaiba unit in southern Brazil, which would make CMPC the world’s second-biggest pulp producer.