By Sarah Lizee
Olympia, Wash., Nov. 20 – Costa Rica placed $1.5 billion of bonds (B+/B+) in two parts, including $1.2 billion of 6 1/8% bonds due February 2031 and a $300 million reopening of its 7.158% bonds due March 2045.
The 2031 bonds were issued with a yield of 6¼% and a price of 99.077, while the reopening of the 2045 notes closed with a yield of 7¼% and a price of 98.925.
The placement followed a four-day roadshow with investors in Los Angeles, New York, Boston and London, as well as a series of calls with international investors.
The bonds were oversubscribed by 5.1 times.
Of the total amount placed, about 80% was allocated to long-term holders’ funds that include pension funds, portfolio managers and insurers, the rest was assigned to banks and hedge funds.
The 2031 bonds introduce a new structure in Costa Rican sovereign bonds, because they include three equal amortizations in the last three years of the notes.
The reopening of the 2045 notes was completed without paying a new issue premium, as they closed at a yield of 7.25%, the level at they were in the secondary market prior to the announcement of the transaction.
Two days after closing, the bonds have shown “extraordinary price stability, tending slightly upwards, as a result of the demand that was left unallocated during the placement process, added to the interest in participating in the purchase of Costa Rican bonds,” the release said.
“The 2031 and 2045 bonds are traded at a price close to 100.5 and 100.4, respectively.”
The proceeds will allow financing needs to be completed to 2019 and pre-fund part of the 2020 requirements.
| Issuer: | Costa Rica
|
| Issue: | Bonds
|
| Amount: | $1.5 billion
|
| Placement date: | Nov. 12
|
| Ratings: | S&P: B+
|
| Fitch: B+
|
|
|
| 2031 bonds
|
| Amount: | $1.2 billion
|
| Maturity: | February 2031
|
| Coupon: | 6 1/8%
|
| Price: | 99.077
|
| Yield: | 6¼%
|
|
|
| 2045 bonds
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| Amount: | $300 million reopening
|
| Maturity: | March 2045
|
| Coupon: | 7.158%
|
| Price: | 98.925
|
| Yield: | 7¼%
|
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