Latin America reacts to Spain's downgrade; Gazprombank sells $500 million seven-year notes

By Aleesia Forni and Paul A. Harris

Columbus, Ohio, April 27 - Activity in the emerging markets space was muted during Friday's session, according to market sources in both London and New York.

"It looks like one of the quietest days I've seen in a while," a New York-based source remarked.

The Markit iTraxx SovX CEEMEA index, which tracks Central and Eastern Europe, the Middle East and Africa credit default swaps, moved sideways on the day and sat at 285 basis points during Friday's London session.

In the Latin American space, markets seemed to move sideways after news that Standard & Poor's cut Spain's credit rating to BBB+ from A late Thursday, according to a market source.

The source noted that the day "could have been uglier," but equity markets boded well and were up approximately 1½% near the end of Friday's session.

"It sort of seemed like the market shrugged off the Spanish downgrades," the source said, adding that Spain's ratings are more relevant to that space due to the large Spanish banking presence in the region.

Pertamina notes

In the secondary market, PT Pertamina's 4 7/8% notes due 2022 traded in Asia at 99.35 bid, 99½ offered. The $1.25 billion issue priced at 99.414 to yield 4.95% on Thursday.

Additionally, the company's $1.25 billion 6% 30-year notes that priced at 98.631 to yield 6.1% traded at 98 bid, 98¼ offered.

Pertamina is a state-owned oil and gas company based in Jarkarta, Indonesia.

Gazprombank prices

In the primary market, Gazprombank (Baa3/BB+) priced a $500 million issue of 7¼% notes due 2019 at par, or mid-swaps plus 567 bps, according to a syndicate source.

The notes priced on top of talk, which was tightened from initial guidance of 7½%.

BNP Paribas, Deutsche Bank and Gazprombank managed the Rule 144A and Regulation S deal.

Gazprombank is a Moscow-based lender.

Yanzhou Coal roadshow

Yanzhou Coal Mining Co. (Baa3/BBB-/BBB-) will begin a roadshow on Wednesday ahead of a possible inaugural issue of dollar-denominated bonds, according to a market source.

The roadshow will make stops in Asia, Europe and the United States.

The coal mining company is based in Jining City, Shandong, China.

Slovak Republic deal

The Slovak Republic (A2/A/A+) is also eying a dollar-denominated transaction and will begin a roadshow ahead of a possible Rule 144A and Regulation S deal, according to a market source.

The roadshow is being arranged by Barclays, Citigroup and JPMorgan.

HPL MTN program

HPL Finance Ltd. launched a $3 billion medium-term note program, according to a company release.

The notes are guaranteed by Hang Lung Properties Ltd.

The company may issue notes under the program within 12 months after May 3.

HSBC is the arranger.

Listing of the program on the Stock Exchange of Hong Kong Ltd. is expected to be effective April 23.

Hang Lung is a Hong Kong-based real estate company.

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