Marfrig Looks for Debt Funds

Brazil’s Marfrig is planning to visit with bond investors beginning this week, in meetings that will test the buyside’s appetite for lower-rated names in the Brazilian protein sector. The meatpacker is looking for $300m in new 2017 bonds, according to Moody’s, which assigns a B2 rating. A deal would follow a BRL1.05bn equity capital sale that raised less than the meatpacker had hoped. Proceeds are to be used to improve the company’s capital structure by lengthening its debt profile. The roadshow starts Friday in Switzerland, and hits Boston Monday before finishing in New York Tuesday. Bank of America Merrill Lynch, Bradesco, Banco do Brasil and Itau are managing. BAML took B2/B+/B+ Marfrig on a non-deal tour in November. Marfrig’s rating reflects still elevated leverage of adjusted gross debt/Ebitda of 6.4x as of September 2012, Moody’s says, noting a high amount of short term debt due over the next few quarters. Marfrig’s last bond sale was in May 2011 when it raised a $750m 2018 bond to yield 8.6%.