SAI Postpones Dollar Bond

Market uncertainty and mixed views on pricing have forced LatAm oil services provider San Antonio Internacional (SAI) to postpone a $500m 7-year NC4 bond, investors say. The issuer met with the buyside last week, aiming for an 11% plus yield, but failed to emerge with a transaction Monday. While some investors blame market factors for the postponement, others say SAI simply represented too much risk to warrant exposure even at low double digits, or a touch higher. “San Antonio is a tough business in a tough market, but there is no difference between 11.5% and 12%. People just didn’t want to buy the bond,” says an investor who declined to participate in the transaction. Investors expressed nervousness about participating against what has been a volatile backdrop and were concerned about secondary performance. “Even if SAI priced well at 11.5% it still would not have performed well under current market conditions,” adds another account following the deal. The fact that SAI leans heavily on cash flows from its Argentine operations was also seen as a negative. Deutsche Bank, HSBC, Itau and Pareto Securities were managing San Antonio’s deal. Ratings were B minus/B3.