Greece contagion worries market players; KMG, ADB price; Braskem, Fibria whispered at 7%

By Christine Van Dusen

Atlanta, April 28 - Greece remained the focus Wednesday for investors and issuers in emerging markets as talks continued with E.U. and International Monetary Fund officials and the sovereign's debt crisis infected other countries, market sources said.

Not even positive news from the day's meeting of the Federal Open Market Committee - where it was determined that interest rates would hold near zero and stay low for an extended period of time - could distract market-watchers from Greece and its contagion effect.

"The Greece effect is definitely slowing things down," a New York-based trader said.

Spain's credit rating was cut by Standard & Poor's, and issuers got cautious. Case in point: The planned issue of dollar-denominated global bonds by Hong Kong property developer Glorious Property Holdings is now on hold, according to a market source.

While some sources speculate the delay is due to too much competition in the market, others believe Greece is to blame.

"That definitely could be it," the trader said.

Issuers move slowly

Some other issuers were taking a wait-and-see approach on Wednesday, too, a market source said.

"It was a very slow day," the source said. "There's not much in the pipeline at the moment."

Still, some deals continued their march to market.

Kazakhstan's KMG Finance (KazMunaiGas) priced $1.5 billion 7% notes due 2020 at 98.243 to yield 7¼%, or Treasuries plus 347.7 basis points, according to an informed market source.

"They were looking at doing a two-tranche deal but settled on the 10-year," the source said.

Also on Wednesday, the Philippines' Asian Development Bank priced R$225 million 9½% notes due 2013 at 100.9375, according to a company filing.

Brazil deals advance

The day also saw some deals from Brazil take steps forward, according to a Brazil-based market source.

Sao Paulo petrochemical company subsidiary Braskem Finance Ltd's planned 10-year dollar-denominated benchmark-sized offering of notes was whispered at 7% on Wednesday, the source said. That deal "should be opened overnight still," he said.

The dollar-denominated benchmark issue of notes due 2020 from Sao Paulo paper and pulp company Fibria Overseas Finance Ltd. also was whispered Wednesday at 7%. "They should price as part of late week's business," the source said.

There was no word, though, on another Brazilian deal in the works: a planned issue of 10-year bonds from beef producer Marfrig Overseas, which is on a roadshow.

Secondary quiet

On the secondary side, Wednesday was "pretty volatile," the New York trader said. "But we ended the day almost unchanged, at least in Asia. The tone was better."

Also on Wednesday, Hong Kong's Fantasia Holdings Group Co. Ltd. planned a roadshow for an issue of senior notes starting April 29 in Asia, Europe and the United States via Citigroup Capital Markets, Merrill Lynch International and UBS AG.

KMG prices 10-year notes

Kazakhstan's KMG Finance (KazMunaiGas) priced $1.5 billion 7% notes due May 5, 2020 (Baa2/BB+/BBB-) at 98.243 to yield 7¼%, or Treasuries plus 347.7 bps, according to an informed market source.

Citi, Credit Suisse and RBS were the bookrunners for the Rule 144A deal, which was whispered at Treasuries plus 275 bps before talk was set at Treasuries plus 350 bps.

The company had initially considered a two-tranche issue of five- and 10-year notes but settled on just 10-year notes, the source said.

KMG is an Astana, Kazakhstan-based, government-run energy firm.

ADB prices notes

Philippines' Asian Development Bank priced R$225 million 9½% notes due April 30, 2013 at 100.9375, according to a company filing.

The bookrunners for the deal were the Toronto-Dominion Bank, Deutsche Bank, RBC and Zurich Cantonalbank.

Asian Development Bank is an international development finance institution based in Manila.

Fantasia sets roadshow

Hong Kong's Fantasia Holdings Group will begin a roadshow for an issue of senior notes starting April 29 in Asia, Europe and the United States, according to a company filing.

Citigroup, Merrill Lynch International and UBS are the joint bookrunners for the Rule 144A and Regulation S deal.

Proceeds will be used for general corporate purposes and to fund existing and new property projects.

The deal is subject to market conditions and investor interest.

Fantasia is a property developer.

Braskem's notes whispered at 7%

Brazil's Braskem Finance's planned 10-year dollar-denominated benchmark-sized issue of notes (expected Ba1/BB+/BB+) is being whispered at 7%, according to a market source.

Bradesco BBI, HSBC and Santander are the bookrunners for the deal, which will launch subject to market conditions and following a roadshow in Europe and the United States.

Braskem Finance is the Cayman Islands-based subsidiary of Braskem, a petrochemical company based in Sao Paulo.

Fibria's notes whispered at 7%

Brazil's Fibria Overseas Finance's planned benchmark-sized issue of dollar-denominated notes due 2020 (expected ratings Ba1/BB/BB) is being whispered at 7%, according to a market source.

Bank of America Merrill Lynch and Santander are the bookrunners for the Rule 144A and Regulation S deal, which could total $500 million and be upsizable to $750 million.

Proceeds will be used for general corporate purposes.

Fibria is a Sao Paulo-based paper and pulp company.

Glorious Property delays deal

Hong Kong-based Glorious Property Holdings has postponed its planned issue of dollar-denominated global bonds (expected ratings B1/B+), according to a market source.

This followed a roadshow that started April 15 via Deutsche Bank, JPMorgan and Standard Chartered Bank.

Some market sources say the delay is due to too much competition in the market. Others blame the contagion effect from Greece's debt crisis.

Glorious Property Holdings is a property developer.

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