DP World sells notes; G7 leaders meet; oil prices climb; trading slow; Turkey, advances deal

By Christine Van Dusen

Atlanta, May 26 – Dubai’s DP World sold notes on a somewhat slow Thursday for emerging markets assets, with bonds from Latin America moving a little bit tighter and prices inching higher while G7 leaders met in Japan to discuss the global economy.

Also affecting the picture on Thursday was the news that crude oil prices climbed above $50 per barrel for the first time this year, a London-based strategist said.

Five-year credit default swaps spreads from Brazil finished the day at 350 basis points from 351 bps, while Mexico’s moved to 350 bps from 351 bps.

“Slow day for global markets,” a New York-based trader said. “Cash prices do get a nice lift from the United States Treasury rally, which has levels close to the highs of the day as we go out.”

Argentina’s Bonar 2024s closed at 110.375 from 110.125 and its 2026s ended the session at 104.60 from 104.125.

Venezuela’s 2027s finished at 41.50 from 43.25, and PDVSA’s 2017s closed at 65.75 from 68.

“Flows were very light today, with slightly better buyers,” he said. “Volumes tomorrow should be very quiet going into the long weekend.”

Investors were also digesting the $9 billion triple-tranche deal from Qatar, the strategist said.

In other news, Turkey announced plans to set out on May 30 for a roadshow to market a possible issue of Islamic bonds, a market source said.

Emirates NBD, HSBC and Standard Chartered Bank are the bookrunners for the sukuk.

Also from Turkey, Turkiye Halk Bankasi (Halkbank) were under pressure on Thursday, moving 10 bps wider, on allegations that a gold trader close to the Turkish president has bribed government officials and the ex-CEO of Halkbank.

DP World sells bonds

In its new deal, Dubai’s DP World priced a $1.2 billion issue of 3.908% seven-year notes at par to yield 3.908%, or 237.5 bps over mid-swaps, according to a market source and a company filing.

Citigroup, Deutsche Bank, Dubai Islamic Bank, HSBC, Barclays, Emirates NBD Capital, First Gulf Bank, JPMorgan, National Bank of Abu Dhabi and Societe Generale CIB were the bookrunners for the Rule 144A and Regulation S sukuk.

The proceeds will be used for a tender offer for the company’s sukuk due in 2017.

Dubai-based DP World is an operator and developer of international marine terminals and provides related services.

Orlen sets roadshow

Poland’s PKN Orlen will set out on May 30 for a roadshow to market a euro-denominated issue of notes, a market source said.

BNP Paribas and Societe Generale CIB are the global coordinators and – along with Citigroup, ING, PKO BP, Santander and UniCredit – joint lead managers and bookrunners for the Regulation S deal.

The issuer is an oil refiner based in Warsaw.

CDB prints notes

On Wednesday, China Development Bank Corp. printed a three-tranche issue of $1.6 billion and €1 billion notes due June 1, 2021 and 2026 (Aa3/AA-/), a market source said.

The $1 billion 2 1/8% five-year notes priced at 99.642 to yield 2.201%, or Treasuries plus 80 bps, following talk in the 105 bps area.

The $600 million 3% 10-year notes priced at 99.555 to yield 3.052%, or Treasuries plus 120 bps, following talk in the 145 bps area.

And a third tranche was added. A total of €1 billion 0.5% notes due in five years priced at 99.445 to yield 0.613%.

Bank of China, BNP Paribas, Bocom HK branch, China Construction Bank (Asia), HSBC, ICBC (Asia), KGI Asia, Mizuho Securities, MUFG Securities and Standard Chartered Bank were the bookrunners for the Regulation S deal.

The proceeds will be used for working capital and general corporate purposes.

The lender is based in Beijing.

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