China's Future Land does deal; market resilient; Qtel sees buyers; slew of roadshows ahead

By Christine Van Dusen

Atlanta, April 16 - China's Future Land Development Holdings Ltd. priced an issue of renminbi-denominated notes on a mixed Tuesday with wider spreads, fairly balanced flows and some demand for higher-beta names.

The Markit iTraxx SovX CEEME ex-EU index on Monday moved wider by 2 basis points, to 195 bps over Treasuries. The corporate index moved out 2 bps to Treasuries plus 225 bps.

"US Treasuries are backing up a little bit this morning, following yesterday's better bid, with equities falling and the Boston bombings," a London-based analyst said.

The tone on Tuesday also was impacted by post-election rioting in Venezuela. This put bonds from Petroleos de Venezuela's (PDVSA) under pressure.

But overall, the market was "very resilient," a London-based trader said. "Even as we had a fairly weak open in Russia and Turkey, [the Middle East] was fairly immune from the selling pressure."

Said the analyst, "Middle East and North Africa markets are steady at the open, and some small tightening has been seen."

Buyers were sighted for Qtel International's 2023s and 2025s while good two-way activity was noted for National Bank of Abu Dhabi's 2019s, which closed at 101½ bid, 102 offered.

"Saw some selling again from the Street on Emirates' 2023s and 2025s," the trader said. "These bonds cannot muster any sort of meaningful move higher."

Jordan's 2015s managed to catch a bid, he said.

"This bond never really performed but is back to the high-98s, bid side," he said.

Small buying also was reported for Saudi Electricity Co.

"The credit is trading OK here," he said. "Bahrain is steady."

Meanwhile, numerous issuers set roadshows, including Czech Republic-based RPG Byty, Turkey's Albaraka Turk Katilim Bankasi AS, Korea Gas Corp., Rwanda, Turkey's Turkiye Finans Katilim Bankasi AS (Finansbank) and Ukraine's Creative Group.

PDVSA debt falls

PDVSA's bonds were under pressure Tuesday, as rioting in the wake of Sunday's election raised concerns of prolonged instability in the region.

A trader saw the 8½% notes due 2017 move down 2½ points to 941/4, while the 9¾% notes due 2035 dropped more than 6 points to end at about 89.

On Sunday, Nicolas Maduro, the vice president who served under Hugo Chavez, was narrowly elected as president. Soon afterwards, opposition candidate Henrique Capriles Radonski was calling for a recount. Capriles' office has said that hundreds of thousands of votes were not counted and that there is evidence of voter fraud and intimidation.

Many Venezuelans took to the streets, rioting and protesting, leaving at least seven dead and many more injured.

GEO up, Homex declines

Mexico-based Corporacion GEO SAB de CV's debt managed to gain slightly, even as Fitch Ratings downgraded the company.

A trader saw the 9¼% notes due 2020 inch up about a ½ point to 51 5/8. The 8 7/8% notes due 2022 were up at 51 7/8.

Meanwhile, Desarrolladora Homex SAB de CV's 9¾% notes due 2020 dropped more than 8 points to 53 following the company's downgrade by Fitch.

And Urbi Desarrollos Urbanos SAB de CV's bonds were all softer, falling 5 to 7 points on the day.

The 8½% notes due 2016 dropped to 32 bid, 32¼ offered from previous levels around 39, while both the 9½% notes due 2020 and the 9¾% notes due 2022 declined to 31 bid, 31½ offered from 36 on Monday.

SIB notes active

In other trading, Sharjah Islamic Bank's recent 2.95% notes due in 2018 that priced at par saw decent two-way interest. By mid-morning in New York, the notes were spotted at 99.83 bid, 99.98 offered, a trader said.

Al Hilal Bank, HSBC, Kuwait's Liquidity Management House and Standard Chartered Bank were the bookrunners for the Regulation S deal.

"SIB was very active first thing between 99.80 and 99.90 and closes at 99.85 on the bid side," he said.

DEWA well offered

Bonds from Dubai Electricity and Water Authority and the Dubai government were well offered on Tuesday.

"It does feel like there is paper around on both names, however," a trader said.

From Russia, sovereign bonds were selling off and were 4 bps to 5 bps wider on Tuesday, another trader said.

"The Turkey long end is still performing, with the 2043s trading at a new high of 103," she said. "In Europe we are seeing selling across the board, with high-yield and new issues particularly suffering."

Ukrainian issues trade down

The recent $1.25 billion 7½% notes due April 17, 2023 that Ukraine priced at par to yield 7½% were trading Tuesday at 98¾ to 991/4.

Citigroup, JPMorgan, Sberbank and VTB Capital were the bookrunners for the Rule 144A and Regulation S deal.

And Ukraine-based agriculture company Mriya Agro Holding Public Ltd.'s new $400 million 9¾% notes due April 19, 2018 that priced at 98.835 traded in the range of 98½ to 99.

Citigroup, Credit Suisse, Goldman Sachs and Sberbank were the bookrunners for the Rule 144A and Regulation S deal.

Future Land does deal

In its new deal, China's Future Land priced RMB 1.5 billion 9¾% notes due April 23, 2016 at par to yield 9¾%, a market source said.

The notes priced in line with talk, set at 9¾%.

BofA Merrill Lynch, BOC International, Citic Securities International, Deutsche Bank and Haitong International were the bookrunners for the Regulation S deal.

The proceeds will be used to repay existing loans, for land acquisitions and for general corporate purposes.

RPG on roadshow

Also on Tuesday, Czech Republic-based property company RPG was on a roadshow for a €400 million issue of seven-year notes, a market source said.

Goldman Sachs and JPMorgan are the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used to repay existing indebtedness and other corporate purposes.

The roadshow began Tuesday and will conclude on Friday.

Albaraka marketing trip ahead

Turkey's Albaraka will set out on a roadshow on Thursday for a dollar-denominated issue of Islamic bonds.

BNP Paribas, Al Hilal Bank, Barwa Bank, Emirates NBD Capital and Nomura Securities are the bookrunners for the Regulation S-only sukuk issue.

The roadshow begins on April 18 in Zurich, then travels to London, Abu Dhabi, Dubai and Doha before concluding on April 23 in Manama.

The company previously announced plans to issue $200 million of five-year notes in 2013.

Korea Gas, Rwanda roadshows

Korea Gas is planning its own roadshow starting April 22 with BofA Merrill Lynch and Goldman Sachs, a market source said.

No other details were immediately available on Tuesday.

And Rwanda will go on a roadshow starting Thursday for its upcoming issue of about $350 million notes, a market source said.

BNP Paribas and Citigroup are the bookrunners for the Rule 144A and Regulation S deal.

Finansbank taps bookrunners

Turkey's Finansbank has mandated Citigroup, HSBC, NCB Capital and Noor Islamic Bank to arrange a roadshow to market a dollar-denominated issue of notes, a market source said.

The Regulation S roadshow will begin Thursday.

And Ukraine-based agro-industrial company Creative Group has mandated BofA Merrill Lynch, Citigroup, UniCredit and VTB Capital as bookrunners for a roadshow to market a $400 million issue of notes.

The marketing trip will begin on Thursday in Switzerland and will travel to London, Los Angeles and Boston before wrapping up on April 24 in New York.

A Rule 144A and Regulation S deal is expected to follow.

Rosneft may issue bonds

Russia's OAO Rosneft is mulling an issue of notes, a market source said.

The new issue could price as soon as this week.

No other details were immediately available on Tuesday.

Rosneft is an oil company based in Moscow.

Odebrecht real, dollar notes

Brazil-based Construtora Norberto Odebrecht SA affiliate Odebrecht Finance Ltd. is planning to issue real- and dollar-denominated notes as part of a tender offer, according to a company announcement.

The tender offer is for $118.6 million of the company's outstanding 7% senior notes due 2020 and $729 million of its outstanding 6% notes due 2023.

The tender offers are conditioned on the closing of the company's offerings of real-denominated notes due 2018 and dollar-denominated notes due 2025. Neither tender offer is conditioned on the tender of any minimum or maximum principal amount of notes.

Construtora Norberto Odebrecht is an engineering and construction company based in Sao Paulo.

Norilsk Nickel in focus

Russia's Norilsk Nickel held a conference call on Monday that raised some questions about the company's refinancing needs, the London analyst said.

"Although management said they would diversify their debt portfolio, few further details were given," she said. "We were left with the impression from previous meetings with NN that the group does not exclude the possibility to come to the eurobond market this year to improve liquidity and have a buffer for its capital expenditure program."

She remains concerned that the likely high dividend distribution will put stress on the company's financial standing.

Kaisa deal oversubscribed

The final book for China-based property developer Kaisa Group Holdings Ltd.'s RMB 1.8 billion 6 7/8% notes due April 22, 2016 was RMB 22 billion from more than 170 accounts, a market source said.

The notes priced at par to yield 6 7/8% with Citigroup, Credit Suisse, HSBC and JPMorgan in a Regulation S deal.

About 98% of the orders came from Asia and 2% from Europe.

Funds picked up 73%, private banks 16%, banks 8% and corporates and others 3%.

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