Emerging Markets: Taiwan Semi wades in for $3.5 billion triple tranche; energy names, sovereigns price notes

By Rebecca Melvin

Concord, N.H., April 23 –Taiwan Semiconductor Manufacturing Co Ltd. raised $3.5 billion with 2026, 2028 and 2031 notes (Aa3/AA-) this past week, while several energy companies tapped the global market, and Colombia, Philippines and the Republic of Srpska stepped into the sovereign space, according to Prospect News’ data.

TSMC Global Ltd., a wholly owned subsidiary of Taiwan Semiconductor, priced a $1.1 billion tranche of 2026 notes, a $900 million tranche of 2028 notes, and a $1.5 billion tranche of 2031 notes. The notes priced with coupons of 1¼%, 1¾% and 2¼%, respectively.

Goldman Sachs International, J.P. Morgan Securities plc, Morgan Stanley & Co. LLC and Citigroup Global Markets Inc. were the lead managers and bookrunners of the Rule 144A and Regulation S offering. Listing on the Singapore exchange is expected to become effective on April 26.

The semiconductor manufacturer is based in Hsinchu, Taiwan.

Among energy companies, Malaysia’s Petroliam Nasional Bhd., or Petronas, also priced a mega-deal this past week. The notes were issued via Petronas Capital Ltd. in two series (A2/A-) including a 10.75-year note and a 40-year note. The $1.25 billion tranche of 2.48% notes due Jan. 28, 2032 priced to yield Treasuries plus 92.5 basis points. The notes were expected to come with a spread in the Treasuries plus 135 bps area.

The $1.75 billion tranche of 3.404% notes due April 28, 2061 priced to yield Treasuries plus 115 bps. The tranche was expected in the 155 bps area.

The proceeds will be used to refinance debt.

According to a Petronas release, the 10.75-year securities were distributed to investors in Asia and the United States at 48% and 43% portions respectively, while investors in Europe and the Middle East together account for 9%.

The 40-year notes were distributed to investors in the United States (46%), Asia (40%), and Europe and the Middle East (14%).

BofA, Citigroup, HSBC, Maybank and MUFG are the bookrunners.

The proceeds will be used for debt refinancing and general corporate purposes, according to Moody’s Investors Service.

Petronas is Malaysia’s national oil company.

Abu Dhabi National Energy Co. PJSC (TAQA), a government-controlled energy holding company with power generation, water desalination, upstream oil and gas, and gas pipelines operations, sold $1.5 billion of notes in two parts on Tuesday.

The company sold $750 million of 2% notes due April 29, 2028 at a spread of Treasuries plus 80 bps, lower than talk in the Treasuries plus 110 bps area.

Additionally, the energy company sold $750 million of 3.4% notes due April 29, 2051 with a Treasuries plus 113.4 spread. The tranche came lower than talk in the 3¾% area.

Citigroup and HSBC are global coordinators. They are also joint lead managers along with five other underwriters.

Equate Petrochemical BV priced $700 million of seven-year senior notes (expected ratings: Baa2/BBB/) at 99.898 to yield Treasuries plus 140 bps, according to a market source.

Pricing was tightened from Treasuries plus 150 bps to 155 bps guidance and initial talk of Treasuries plus 170 bps area.

Equate Petrochemical Co. KSCC and Kuwait Olefins Co. KSCC are guarantors of the notes.

They are callable for a make-whole premium of Treasuries plus 25 bps and then callable at par three months prior to maturity.

Citigroup, J.P. Morgan, MUFG and NBK Capital are the global coordinators, joint lead managers and joint bookrunners of the Rule 144A and Regulation S deal. They are joined by BNP Paribas, HSBC, Mizuho Securities, SMBC Nikko and Standard Chartered Bank as joint lead managers and joint bookrunners.

Equate is an Ahmadi, Kuwait-based petrochemical company that is 85% owned by Petrochemical Industries Co. and Dow Chemical.

Shifting to yet another industry sector, Mexico's Fomento Economico Mexicano, SAB de CV priced a combined €1.2 billion of notes due 2028 and 2033 (A-/A) on Thursday.

The deal included €700 million ½% notes due 2028 that priced at 99.647 to yield 0.551%, or mid-swaps plus 70 bps. There is a step-up of 25 bps after five years, subject to sustainability targets.

The deal also included €500 million 1% notes due 2033 that priced at 99.233 to yield 1.068%, or mid-swaps plus 88 bps. There is a step-up of 25 bps after 10 years, subject to sustainability targets.

The notes have a make-whole call and a par call.

BofA Securities, Inc., HSBC Bank plc and J.P. Morgan Securities plc are joint bookrunners for the offering.

Proceeds will be used to redeem Femsa’s 1¾% notes due 2023 with the remainder, if any, for general corporate purposes

Femsa is a Monterrey, Mexico-based Coca-Cola bottler.

Among China’s issuers, China Construction Bank Corp. was a notable feature. The CCB’s Hong Kong Branch priced $600 million of 0.86% series A senior sustainability-linked notes due 2023 and $550 million of 1.46% series B senior sustainability-linked notes due 2026, according to a listing notice.

The joint global coordinators, joint bookrunners and joint lead managers for the notes are Agricultural Bank of China, China Construction Bank, Citigroup, HSBC and Mizuho.

Additional joint bookrunners are Bank of China, Bank of Communications, BNP Paribas, BofA Securities, BOSC International, China Everbright Bank Hong Kong Branch, China International Capital Corp. CLSA, Credit Agricole CIB, ICBC, J.P. Morgan, Nanyang Commercial Bank and SMBC Nikko.

The Regulation S notes were issued out of the $15 billion medium-term note program established by the issuer and CCB Corp.

New sovereign notes

The Republic of Colombia priced $3 billion of new global bonds due 2032 and 2042 including $2 billion of 3¼% bonds due 2032, which priced at 99.032 to yield 3.356%, or a spread of Treasuries plus 175 bps; and $1 billion of 4 1/8% bonds due 2042, which priced at 98.492 to yield 4.235%, or a spread of Treasuries plus 205 bps.

Prior to Jan. 22, 2032 the 2032 notes have a make-whole call at Treasuries plus 30 bps, then they are callable at par. And prior to Aug. 22, 2041 the 2042 bonds are redeemable at par plus a premium of Treasuries plus 35 bps, then they are callable at par.

BofA Securities Inc., Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC. were joint bookrunning managers of the SEC-registered deal.

The Republic of the Philippines priced €2.1 billion of global bonds due in four, 12 and 20 years (Baa1/BBB+/BBB).

The bonds are non-callable.

The €650 million tranche of ¼% four-year bonds priced at 99.509 for a yield of 0.374%, or a spread over mid-swaps of 75 bps.

The €650 million tranche of 1.2% 12-year bonds priced at 99.468 for a yield of 1.248%, or a spread over mid-swaps of 105 bps.

The €800 million tranche of 1¾% 20-year bonds priced at 99.050 for a yield of 1.807%, or a spread over mid-swaps of 135 bps.

BNP Paribas, Credit Suisse Securities (Europe) Ltd., Goldman Sachs (Asia) LLC, J.P. Morgan Securities plc, Nomura International (Hong Kong) Ltd. and Standard Chartered Bank were joint lead managers and joint bookrunners of the SEC registered notes.

The republic is applying to list the bonds on the Luxembourg Stock Exchange for trading on the Euro MTF Market.

And finally, the Republic of Srpska priced €300 million of 4¾% notes due 2026 (B3/B) at 98.918 for a 5% re-offered yield or spread over mid-swaps of 528.7 bps, according to a pricing term sheet.

The size of the deal for the autonomous entity of Bosnia and Herzegovina was expected to be up to €350 million.

Intesa Sanpaolo SpA London Branch, Societe Generale CIB and UniCredit Bank AG were joint lead managers of the Rule 144A and Regulation S transaction, which priced on April 20.

The proceeds of the notes will be used to refinance most of the sovereign’s domestic debt maturing in 2021 and an anticipated budget deficit and costs related to the Covid-19 pandemic.

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