Suramericana Sees Demand for Long Bonds

Demand for Grupo de Inversiones Suramericana’s bonds surged to COP1.3trn ($657.6m) Wednesday, according to a local DCM banker close to the transaction. The holding company sold COP250bn ($127m) as planned in 3 tranches. The 10-year notes, of which the banker says COP54.00bn was sold, pay IPC plus 4.40%; the 20-year, of which COP98.00bn was sold, pay IPC plus 5.90% and the 40-year notes, of which COP97.50bn was sold, pay IPC plus 6.98%. The banker says Suramericana is the first Colombian company to issue 40-year bonds. The longest tenor had been for notes issued by the government, which had a tenor of 33 years, he adds. Proceeds will be used to finance the company’s acquisition of its insurance subsidiary’s investment portfolio. Fitch has an AAA national rating on the issue. Bancolombia managed the sale.