Braskem Squeaks Through DCM Window

Braskem raised $400m in a bond sale Friday, alongside Pan American energy’s $500m offer, as the region’s last DCM deals squeaked through the end of a volatile week. The pipeline is significantly thinner this week, and EM is braced for more spillover from choppy US markets and European sovereign woes. The Brazilian petrochemicals producer stuck to its guns, pricing the 2020 at 7%, in line with guidance and early whispers, though raising less then initially targeted. The level turned off many on the buyside who found it too tight for a BB+/Ba1 credit, especially in last week’s jittery market. The $900m book meant a $400m size, despite expectations of $500m-$750m. Braskem priced at par with a 7% coupon. The bond was heard trading around reoffer in the gray Friday afternoon. Bankers on the deal say the issuer’s priority was the 7% level, regardless of the size, as it is not desperate for funds. The majority of proceeds were to be used to refinance indebtedness at Quattor Participacoes, which Braskem agreed to buy in January along with other assets from Unipar for BRL700m, plus the assumption of up to BRL170m in debt. Banco do Brasil, Bradesco, HSBC and Santander managed the sale, done through the Braskem Finance Cayman Islands vehicle.