Minerva Prices Tight Despite Rough Market

Despite tough global markets conditions, Minerva has raised $250m in 2020 NC5 bonds through the first single B Brazil deal of 2010. The meatpacker priced late Friday the B/B3 bond at 98.131 with a 10.875% coupon to yield 11.200%, toward the tight end of 11.25% area guidance. The new bond was heard trading around reoffer in the gray late Friday, according to investors. It was likely helped by recent tightening in the outstanding 2017 through 10.00%, investors say, even as much of the market moved the other way. “Given that the market has been trading off and initial guidance was higher, this priced tighter than expected,” says Juan Cruz, head of Latin America corporate credit research at Barclays. “This is not a credit without risk, so for them to price at this level is positive,” he adds. Proceeds are earmarked for refinancing 2010 and 2011 maturities, as the issuer looks to reshape a challenging financial profile that includes 7.7x total debt/Ebitda, the highest of its peers, according to Barclays. Goldman Sachs and Banco do Brasil managed the sale. Minerva’s previous dollar bond was a $150m 9.5% of 2017 sold in January 2007 via Credit Suisse, Santander and Bradesco. It was reopened the following month for $50m. It remains unclear whether the global selloff deters other Latin high-yield issuers in the pipeline, including Marfrig and Vanguarda from the Brazil food sector.