Braskem Gives a Little on $750m Bond

Braskem has priced $750m in 2021 bonds at 98.14 with a 5.75% coupon to yield 6.00%, or UST plus 243bp, at the tight end of 6.000%-6.125% guidance. Braskem is funding a tender offer for shorter, more expensive bonds. Capitalizing on its recent promotion to investment grade by S&P, the petrochemicals producer was heard getting more than $2.5bn in orders for the Baa3/BBB minus/BB+ bond, with a yield that pleased investors. “They left a little bit on the table this time,” says a New York-based EM investor. He sees a 10bp-15bp concession to the curve, noting that the company has not given up much in the past. The bond traded up slightly in the gray market, according to a trader. “This is an improving situation,” says another US EM investor participating in the deal. He expects a third investment-grade rating soon, and sees Braskem in strong position to improve in the next 2-3 years along with Brazil’s GDP growth. Citi, Deutsche Bank and Santander managed the deal. Braskem is raising the funds to buy back any and all of $250m in 11.750% 2014 bonds, $250m in 9.375% 2015s and $275m of 8.000% 2017 bonds. It will offer $1,242.50 per $1,000.00 for the 2014, $1,220.00 per $1,000.00 for the 2015 and $1,168.75 per $1,000.00 for the 2017, it says, in a tender launched as soon as today. Braskem’s most recent transaction was a $450m perpetual in September.