Primary market hosts China's Chalco; Ukraine in focus; EM ends week tighter; Agile sets talk

By Christine Van Dusen

Atlanta, Feb. 21 - China Aluminum International Engineering Corp. Ltd. (Chalco) issued notes at the end of a volatile week for emerging markets assets that had investors keeping a close eye on the developments in Ukraine.

"After a robust start to the week, Wednesday and Thursday saw risk-off sentiment return once again to [emerging markets]," a London-based analyst said. "But most sectors end the week tighter, overall."

Violent clashes in Kiev have killed at least 77 people, according to published reports. On Friday, Ukraine's opposition leaders entered into a peace agreement with President Viktor Yanukovych that observers hope will hold.

"The market has generally reacted positively today on anticipations that an election may finally bring an end to the tensions in the country," the London-based analyst said.

In other trading at the end of the week, bonds from Turkey's corporates and banks saw "surprisingly strong" demand, a trader said.

"The sovereign curve had a more mixed performance, with the long end underperforming the belly," she said. "The 2043s are 2 basis points tighter on the week, versus the Turkey 2021s, which are 18 bps tighter."

Most Turkish banks ended the week 14 bps tighter, on average, with Turkiye Halk Bankasi (Halkbank) and Turkiye Vakiflar Bankasi TAO (VakifBank) leading the way.

"In Central and emerging Europe, Hungary and Croatia both underperformed earlier in the week but have come back this morning, helped by the better sentiment," she said. "Slovenia continues its recent trend of outperformance. The 2023s were 20 bps tighter."

Overall, though, trading activity was "relatively limited" during the week, she said.

Chalco sells bonds

In its new deal, Beijing-based metals manufacturer Chalco priced a $300 million issue of 6 7/8% perpetual notes at par to yield 6 7/8%, or Treasuries plus 615.2 bps, a market source said.

The notes were talked at a yield in the 7¼% area.

Morgan Stanley was the sole global coordinator. Morgan Stanley and CLSA were joint bookrunners for the Regulation S deal.

The proceeds will be used as supplemental working capital for the company's overseas operations.

Agile gives guidance

Hong Kong-based Agile Property Holdings Ltd. set price talk in the 6 7/8% area for its upcoming renminbi-denominated issue of notes due in three years, a market source said.

HSBC, Morgan Stanley and Standard Chartered Bank are the bookrunners for the Regulation S deal.

The proceeds will be used to refinance the company's $300 million aggregate principal amount of 10% notes due 2016.

Brazil sets roadshow

Brazil has mandated BB Securities, JPMorgan and Santander GBM as bookrunners for non-deal roadshow, a market source said.

The roadshow begins Feb. 26 in Frankfurt and Munich and will travel to Amsterdam and Paris before concluding on Feb. 28 in London.

China Properties postpones

China Properties Group Ltd. has postponed its planned issue of dollar-denominated notes due in three years, a market source said.

The notes had been talked at a yield in the 12¾% area.

BofA Merrill Lynch was the bookrunner for the Regulation S deal.

The company had previously announced plans to issue renminbi notes, with the proceeds for expansion strategies, refinancing and general working capital purposes.

China Properties is a Hong Kong-based real estate developer focusing on large-scale residential and commercial projects in China's major cities.

China Resources oversubscribed

The final book for China Resources Land Ltd.'s new $400 million issue of 4 3/8% notes due 2019 that priced at 99.773 was $1.1 billion from 128 accounts, a market source said.

About 88% of the orders came from Asia and 12% from Europe.

Fund managers accounted for 73%, banks 14% and private banks 13%.

The company's $700 million 6% notes due 2024 that priced at par drew $1.2 billion in orders from 63 accounts, with 95% from Asia and 5% from Europe.

Fund managers picked up 98% while private banks took 2%.

ABCI Capital Ltd., DBS Bank Ltd., HSBC, J.P. Morgan Securities LLC, Merrill Lynch International and UBS AG, Hong Kong Branch were the bookrunners and lead managers for the Regulation S deal.

Indian Railway final book

Indian Railway Finance Corp. Ltd.'s recent issue of $500 million 3.817% notes due 2019 attracted more than $3 billion in orders, a market source said.

The notes priced at par to yield 3.917%, or Treasuries plus 245 bps.

About 54% of the orders came from Europe and 46% form Asia, with 76% from asset managers and 24% from banks.

ANZ, Barclays, Deutsche Bank and RBS were the bookrunners for the Regulation S deal.

Chinese investors like Shui On

The new issue of RMB 2.5 billion 6 7/8% notes due 2017 that China's Shui On Land Ltd. printed at par drew 71% of its orders from Hong Kong, a market source said.

About 28% of the orders came from Singapore and 1% from Europe, with private banks picking up 62%, fund managers 27% and banks 11%.

BNP Paribas, Deutsche Bank, JPMorgan, Standard Chartered Bank Hong Kong and UBS were the bookrunners for the Regulation S deal.

The proceeds will be used to repay indebtedness and to fund capital expenditures.

New World gets orders

China-based New World Development Co. Ltd.'s new $750 million 5¼% notes due 2021 that priced at 99.705 brought in a final book for $3.3 billion from more than 180 orders, a market source said.

The notes came to the market at Treasuries plus 320 bps via HSBC, JPMorgan, UBS and CLSA in a Regulation S deal.

About 90% of the orders came from Asia and 10% from Europe.

Fund managers accounted for 38%, private banks 27%, banks 24%, insurers 8% and corporates 3%.

The property, infrastructure, services and telecommunications company is based in Hong Kong.

Citic does deal

On Thursday, China Citic Bank Corp. Ltd. priced RMB 1.5 billion 4 1/8% notes due 2017 at par to yield 4 1/8%, a market source said.

BBVA, Citic Securities International, China Citic Bank International, HSBC and Mizuho Securities were the bookrunners for the deal.

Proceeds will be used to grant loans, to increase liquidity and for other general corporate purposes.

The issuer is a Beijing-based bank.

© 2015 Prospect News.
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