Road Operator Delays BRL Bond Pricing

Concessionaria Rodovias do Tiete has pushed back the pricing of its BRL650m ($320m) debenture sale until at least next week, according to investors following the process. The toll road operator’s inflation-linked 2024 bond is secured by the pledge of Tiete’s equity, future receivables of its toll revenues and indemnification rights over concession assets. It is looking to pay a fixed rate of up to 8.75%. The bond has been touted as the first to take advantage of a program offering tax incentives to buyers of infrastructure-related bonds, and is said to be marketed to both domestic and international accounts. However, investors say there is some uncertainty as to whether the bonds will fully qualify for the tax benefits, as the proceeds are use used to pay off BRL480m in short-term debt in addition to funding road capex. Barclays is managing the sale, in the bank’s first Brazilian domestic market bond, rated Aa3 on a national scale.