Issuers Return to Low Yield Trough

Mexico’s Pemex, and Argentina’s Cordoba Province and IMPSA have retapped their recent bond issues, joining the Province of Buenos Aires this week in adding on at tempting prices. “Spreads have been tightening and we’re not sure when this rallying market will fade. It’s in the interest of those looking to add a bit to do so,” says a London-based EM investor buying Cordoba, which he says priced fairly. Cordoba stepped in for $196m while Pemex has added $250m to its perpetual sold in September, taking advantage of a rally in Mexican corporates and status among investors as the best-performing of a group of perpetual bonds issued in September. Pemex reopened its 6.625% of perp NC5 at 103, the level at which the deal had been announced Thursday morning. The price represents about a 75bp discount from secondary levels of around 104, investors say. Orders were heard reaching $900m. Credit Suisse managed the Baa1/BBB/BBB sale that brings the outstanding size to $1bn. Citi and HSBC managed the original sale. Cordoba, meanwhile, retapped its 12.375% of 2017 at 103.000 to yield 11.716%. Investors spotted the B3/B bond at 104.5-105.0 the day before. The province went for the retap due to reverse inquiry and secondary market performance, bankers say, noting $800m in orders. Citi and UBS, the original leads, managed the sale. Cordoba now has $596m in outstanding 2017s, its maximum authorization say bankers on the deal. The first sale raised $400m on more than $1bn in demand. Finally, IMPSA came out for $50m more of the 10.375% 2015 bonds it sold in September to fund a tender offer at its WPE unit. The B3 deal reopened at 99.000, for a 10.538% yield, through original leads Bank of America Merrill Lynch and UBS.