Cikarang plays to massive book; Minvera comes tight to revised talk; Ukraine bonds hold in

By Cristal Cody and Paul A. Harris

St. Louis, Jan. 22 - Emerging market bond prices were weaker on Friday against a backdrop of widespread weakness on most of the world's major stock indexes, sources said.

Eastern Europe emerging markets softened on Friday, a London-based trader said after that market closed.

"It's been quite a day with volatile equities," the trader said.

"It's been a week of softening basically. The Greece situation is being monitored. Obama, with his comments yesterday, didn't help.

"There's a lot going on."

U.S. president Barack Obama on Thursday offered proposals to limit the size and trading activities of financial institutions as a way to reduce risk-taking in the financial sector.

Looking to the week ahead, the market will continue to be "watching Greece" as it attempts to handle its budget crisis in part by syndicating a five-year benchmark bond, the trader said.

"We've had a great run-up in the first couple of weeks of the new year," the trader said. "It makes sense there's some easing off of the markets.

"We're definitely seeing some selling, but it's not big volume - we're not seeing all the paper change hands."

Ukraine holding in

Ukraine's sovereign bonds held in on Friday, while much of the rest of the market fell, the London-based trader said on Friday.

The Ukraine sovereigns were steady throughout the week as players eyed the upcoming presidential election, set for Feb. 7.

"Ukraine is a little bit of a standout," the source said.

Ukraine's 6.385% euro bonds due 2012 were holding in at 93¼ bid, 94¼ offered. The notes came in a $500 million issue, at par, in June 2007.

In addition, the 6.58% bonds due November 2016 were 83½ bid, 84½ offered. Those notes came in a $1 billion issue, which priced at par in November 2006.

"Ukraine is largely unchanged on the week while everything else is under pressure," the trader said, adding that because of the impending election, investors perceive them to be cheap.

"Ukraine's typically chaotic, so they expect no change to that," the trader said. "That may all change if some disaster comes out of the poll."

Ukraine five-year CDS also held in amid widening seen elsewhere in the emerging markets space.

The CDS were 920 basis points mid heading into the European close, according to a market source, 22 bps tighter on the day.

Brazil five-year CDS, on the other hand, were headed out 2 bps wider, at 131 bps mid.

Russia five-year CDS were 4.5 bps wider at 174 bps mid.

Cikarang plays to $1.6 billion book

In Friday's primary market, Indonesia's Listrindo Capital BV (PT Cikarang Listrindo) priced a $300 million issue of 9¼% five-year senior notes (Ba2/BB) at 99.106 to yield 9½%.

The yield printed 12.5 bps through the 9¾% area price talk.

Barclays Bank plc and Credit Suisse Securities were joint bookrunners.

Proceeds will be used to repay bank debt, as well as to fund the company's capacity expansion program and for general corporate purposes.

The deal played to a $1.6 billion order book, according to an informed source, who added that allocations were tough.

In the secondary market the new Cikarang 9¼% notes due 2015 were 101½ bid, versus the 99.106 issue price, the source added.

Minerva tight to revised talk

Meanwhile, Brazil's Minerva Overseas II Ltd. priced a $250 million issue of 10 7/8% 10-year senior fixed-rate notes (B3/B-/B) at 98.131 to yield 11.2%.

The yield printed tight to revised price talk of 11¼%. Initial price talk was in the 11½% area.

Goldman Sachs & Co. and BB Securities were joint bookrunners.

Proceeds will be used to refinance debt.

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