Primary hosts ICBC, MIE Holdings, Finansbank, Romania; Ukraine, Russia tension continues

By Christine Van Dusen

Atlanta, April 15 - Industrial and Commercial Bank of China Ltd., China's MIE Holdings Corp., Turkey's Turkiye Finans Katilim Bankasi AS and Romania sold notes on Tuesday as turmoil continued in Ukraine and Russia, with the European Union considering additional sanctions against the latter sovereign.

"Tensions remain high in Ukraine as the government starts an anti-terrorist operation against pro-Russian activists," a London-based analyst said. "Thursday's meeting between the European Union, United States, Ukraine and Russia will be a clear focus for investors."

Against this backdrop, bonds from Russia opened stronger but faded as the day went on, with spreads ending up largely unchanged at the end of the European session, she said.

"This morning we are seeing better buyers of certain corporate names, like Rosneft, Gazprom Neft," she said. "Elsewhere, Central and emerging Europe is opening relatively unchanged."

Said a trader, "The backdrop globally is mixed at best, and further geopolitical headlines are going to drive short-term sentiment. Flows are a lot more balanced than they were at the start of the year."

Looking to the Middle East, Dubai-based Damac Real Estate Development Ltd.'s recent issue of $650 million 4.97% notes due 2019 continued to widen, a London-based trader said.

The notes came to the market in late March at par to yield 4.97% via Barclays, Citigroup and Deutsche Bank in a Regulation S deal.

"Busy day from the word 'go,'" a London-based trader said. "The Gulf region was fairly two-way. Some lower-beta names - Qatar, Saudi Electricity Co. - were ticking higher with rates."

In deal-related news on Tuesday, Brazil's Votorantim Cimentos SA, Indonesia's PT Sri Rejeki Isman Tbk (Sritex) and Banco Santander Chile set talk for upcoming issues.

DEWA gets upgrade

Also on Tuesday, Moody's Investors Service upgraded Dubai Electricity and Water Authority to Baa2, which pushed the company's bonds somewhat higher, a trader said.

"DEWA's 2020s on the month are 40 basis points tighter," he said. "DEWA's 2015 is still a decent place to park cash, short-dated."

Bonds from Dubai closed the day 5 bps to 6 bps wider, with the 2043 dollar bonds suffering the most, he said.

"Perpetuals are proving a little tricky," he said.

GEMS performance 'impressive'

The 12% perpetual notes that United Arab Emirates-based Global Education Management Systems Ltd. priced in November at par were seen trading with an "impressive" 117 handle on Tuesday, another trader said.

Abu Dhabi Islamic Bank, Credit Suisse and Morgan Stanley were the bookrunners for the Regulation S deal.

Africa in focus

From Africa, sovereign paper from Nigeria widened between 5 bps and 10 bps on Tuesday on low volumes, a trader said.

Nigeria-based Zenith Bank's recent $500 million issue of 6¼% notes due 2019 that priced at par traded Tuesday at 99.65 bid, par offered.

"Good retail interest on this one," he said.

It was two-times oversubscribed, a market source said.

Citigroup and Goldman Sachs were the bookrunners for the Rule 144A and Regulation S deal.

"The recent Zambia 2024 dollar notes are closing back above 101, 6 bps tighter," he said. "Angola is almost unchanged on the month now, at 108½ bid, 109¼ offered."

OCP eyed

Some market-watchers were keeping an eye on Morocco's Office Cherifien de Phosphate (OCP) on Tuesday, ahead of the phosphate exporter's 10-year issue of about $1 billion of notes.

The phosphate exporter set talk in the 6% area.

The proceeds will be used to fund the company's expenditure program and for general corporate purposes.

"We expect OCP to be tighter to the Moroccan sovereign to reflect the 95% government ownership," a trader said. "We think it will be a welcome addition to the [emerging markets] universe, offering an alternative means of exposure to Morocco and, depending on price, likely to attract investor attention."

The proceeds of the deal will be used to fund the company's expenditure program and for general corporate purposes.

MIE prices bonds

China's MIE Holdings priced a $500 million issue of 7½% notes due 2019 at 98.98 to yield 7¾%, a market source said.

The notes priced at the tight end of talk, set at 7¾% to 7 7/8%.

Deutsche Bank, BofA Merrill Lynch, HSBC, JPMorgan, Morgan Stanley and UBS were the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used to redeem the company's 2016 notes and fund related redemption costs, as well as for capital expenditures, working capital and general corporate purposes.

MIE is a Hong Kong-based independent upstream oil company.

Romania does deal

Romania priced a €1.25 billion issue of 3 5/8% notes due 2024 (Baa3/BB+/BBB-) at 99.374 to yield 3.701%, or mid-swaps plus 200 bps, a market source said.

The notes were talked at a spread in the 225 bps area.

Citigroup, ING, Societe Generale and UniCredit were the bookrunners for the Regulation S deal.

Issuance from Finansbank

Turkey's Finansbank sold $500 million 5 3/8% notes due 2019 at par to yield 5 3/8%, or mid-swaps plus 363.4 bps, a market source said.

The notes were talked at 5 3/8% to 5½%.

Citigroup, Emirates NBD, HSBC and QInvest are the bookrunners for the Regulation S sukuk.

Finansbank is an Istanbul-based lender.

Votorantim gives guidance

Brazil-based cement company Votorantim Cimentos set talk in the mid-swaps plus 240-bps area for its euro-denominated and benchmark-sized issue of notes due in seven years, a market source said.

Citigroup, HSBC, Santander GBM, BB Securities, Banco Votorantim and Bradesco BBI are the bookrunners for the Rule 144A and Regulation S deal.

The notes are expected to price on Wednesday.

The proceeds will be used for general corporate purposes.

Sritex sets talk

Indonesian textile manufacturer Sritex set talk in the high-8% to 9% area for its upcoming dollar-denominated issue of five-year notes, a market source said.

Barclays is the sole bookrunner and lead manager for the Rule 144A and Regulation S deal.

The notes will be issued by Golden Legacy Pte. and guaranteed by Sritex and subsidiary PT Sinar Patnja Djadja.

Guidance from Santander Chile

Banco Santander Chile set talk for its three-part issue of fixed- and floating-rate notes due in three and five years, a market source said.

The three-year fixed-rate notes were talked at guidance yen swaps plus 43 bps to 50 bps.

The three-year floating-rate notes were talked at Libor plus 53 bps to 60 bps.

And the five-year fixed-rate notes were talked at yen swaps plus 58 bps to 65 bps.

Daiwa Securities, JPMorgan and Mizuho Securities are the bookrunners for the deal.

The notes could price as soon as Wednesday.

Bank deal oversubscribed

The final book for Bank of East Asia Ltd.'s new $700 million 2 3/8% notes due 2017 was $2.9 billion from 144 accounts, a market source said.

The notes priced at 99.727 to yield 2.47%, or Treasuries plus 165 bps, following talk in the 170 bps area.

Citigroup, CLSA, HSBC and Goldman Sachs Asia were the bookrunners for the Regulation S deal.

About 92% of the orders came from Asia and 8% from Europe, with 48% from banks, 28% from the public sector, 17% from fund managers, 4% from insurers and 3% from private banks.

The proceeds will be used for general corporate purposes.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.