Arauco Set for Local Bond

Celulosa Arauco is expected to issue up to UF5m ($232m) in the Chilean local bond market today, according to DCM sources. The paper company is able to choose from a 2017 bullet with a 3.50% coupon and a 2033 tranche with a 10-year grace period and 4.00% coupon. About 70% of proceeds would cover investment financing and 30% would repay liabilities of Arauco and its affiliates. IMTrust is leading the sale, rated AA on a national scale. Arauco last issued in the local markets in 2010, through a UF5m 2020 sale, according to Dealogic, and raised $500m in 10-year bonds in the dollar markets in January.