Andina Bottles Acquisition Funds

Embotelladora Andina has priced $575m in new bonds, to the tune of about $2.7bn demand, according to people familiar with the transaction. Moving to replace acquisition debt, the BBB/A minus Chilean bottler priced the 2023 at 99.805 with a 5.000% coupon to yield 5.025%, or UST+237.5, at the tight end of 237.5bp-250bp guidance that followed 262.5bp-area talk. The bond reached 100.50-100.75 in the aftermarket, according to investors. Comps included 2023 bonds from Mexico’s Coca-Cola Femsa (A2/A/A minus), and Peru’s Corporacion Lindley (BBB minus/BB+). KOF was seen at UST+165bp, and Lindley about 150bp wider, giving Andina a wide berth to price its first international bond since 1997. “This is reasonable pricing for a BBB+ [average] credit,” says an EM portfolio manager, estimating a 20bp concession. Andina in July agreed to buy Brazilian Coca-Cola bottler Companhia de Bebidas Ipiranga in a deal valued at BRL1.22bn ($527m), and is raising funds to repay a bridge to lenders JPMorgan, Itau and Santander, who managed the bond sale.