Evraz, Eastcomtrans, Kaisa, Yingde do deals; corporate spreads widen; Turkish bonds see buyers

By Christine Van Dusen

Atlanta, April 15 - Russia's Evraz Group SA, Kazakhstan's Eastcomtrans LLP, China's Kaisa Group Holdings Ltd. and China's Yingde Gases Group Co. Ltd. sold notes on Monday amid mixed spreads as American investors focused on the news of explosions at the Boston Marathon.

The Markit iTraxx SovX CEEME ex-EU index on Monday moved wider by 1 basis point, to 193 bps over Treasuries. The corporate index moved out 6 bps to Treasuries plus 223 bps.

"After the flood of issuance last week, we expect the same in the next few days," a London-based analyst said.

In trading, better buying was reported for Turkey's 2043 notes, which moved to 1021/2. Buyers were also noted for Akbank's 2022s, GarantiBank's 2022s and Vakifbank's 2018s.

"Steady start in the Middle East and North Africa, with some demand for International Petroleum Investment Co. and Dubai Electricity and Water Authority," a trader said. "With the perpetuals, it still feels like there's a little bit of paper around. The recent Sharjah Islamic Bank is holding at a shade below par."

In its new deal, Russia-based steel producer Evraz sold $1 billion 6½% notes due April 22, 2020 at par to yield 6½%, after talk of a yield in the 6¾% area.

ING, JPMorgan and UBS were the bookrunners for the Regulation S deal.

The proceeds will be used to refinance existing indebtedness, according to a company announcement.

"Fairly priced, and should do well in the medium-term," the analyst said.

And China-based industrial gas producer Yingde Gases priced $300 million 8¼% notes due April 19, 2018 at 99.496, according to a company filing.

Deutsche Bank was the bookrunner for the Rule 144A and Regulation S notes.

The proceeds will be used for capital expenditures, general corporate purposes and for financing certain indebtedness.

Kaisa, Eastcomtrans sell notes

In another new deal, Chinese property developer Kaisa Group printed an RMB 1.8 billion issue of 6 7/8% notes due April 22, 2016 at par to yield 6 7/8%, a market source said.

The notes priced tighter than talk, set at the 7 1/8% area.

Citigroup, Credit Suisse, HSBC and JPMorgan were the bookrunners for the Regulation S deal.

And Kazakhstan-based railway operator Eastcomtrans sold $100 million notes due April 22, 2018 at 98.986 to yield 8%, a market source said.

The Regulation S notes, via HSBC and BNP Paribas, were talked in the low-8% area.

Lai Fung mandates banks

In deal-related news, China's Lai Fung Holdings Ltd. has mandated DBS Bank, HSBC and JPMorgan as the bookrunners for a renminbi-denominated issue of notes that will be marketed during a roadshow, a market source said.

The Regulation S marketing trip will begin Tuesday and take place in Singapore and Hong Kong.

Lai Fung Holdings is part of Hong Kong-based Lai Sun Group, a conglomerate.

And Turkey's Turkiye Cumhuriyeti Ziraat Bankasi AS is planning to issue notes this year.

TgP picks leads

Transportadora de Gas del Peru SA (TgP) has mandated BofA Merrill Lynch, Morgan Stanley, BBVA, Citigroup, Itau BBA and BCP Capital to arrange a roadshow to market an issue of dollar notes, a market source said.

The roadshow for the Rule 144A and Regulation S deal will begin Wednesday in Lima and Los Angeles and travel to New York and Santiago before concluding on April 22 in London and Boston.

TgP is a gas transporter based in San Isidro, Peru.

Polyus sets deal size

Emerging markets-focused Polyus Gold International Ltd. has set the size at $750 million for its upcoming issue of notes, a market source said.

The deal is currently being marketed on a roadshow.

And Russia-based oil exploration company Exillon Energy plc has shelved plans for a dollar-denominated issue of five-year notes, a market source said.

The notes were initially talked at a yield in the 8% area.

HSBC and VTB Capital were the bookrunners for the Rule 144A and Regulation S deal.

CAG plans roadshow

Brazil's Construtora Andrade Gutierrez SA (CAG) has mandated BTG Pactual, JPMorgan and Espirito Santo Investment Bank as bookrunners for a dollar-denominated issue of benchmark-sized notes that will be marketed during a roadshow, a market source said.

The roadshow will begin Tuesday in Santiago and travel to New York City and Boston before wrapping up on April 22 in London and Los Angeles.

CAG is the Belo Horizonte, Brazil-based subsidiary of Andrade Gutierrez SA, an engineering and construction company.

Koc Holding on deck

One trader was keeping an eye on another upcoming issue from a Turkish corporate. Industrial conglomerate Koc Holding AS is on a roadshow for an issue of as much as $1 billion with BofA Merrill Lynch, BNP Paribas, Citigroup and Deutsche Bank.

"Koc will use the bond to diversify funding and extend the maturity profile while at the same time gaining some additional liquidity, if merger and acquisition opportunities arise," she said. "Management does not anticipate to be a frequent issuer, and we view this bond as an opportunity for investors to get diversified, high-quality asset exposure to Turkey."

But the deal is likely to be price-sensitive, she said, given the lack of liquidity needs.

"As such, the deal is likely to be sized to price," she said. "The group has approval to issue up to $1 billion of bonds with initial price and size guidance expected to be released Wednesday."

Minmetals deal ahead

In other deal-related news, China-based property company Minmetals Land Ltd. has mandated five banks for an issue of bonds, according to a company filing.

BNP Paribas, UBS, HSBC, Morgan Stanley and Bank of China are the bookrunners for the Regulation S deal.

The proceeds will be used to fund new and existing property projects and for general corporate purposes.

And Russia-based Alliance Oil Co. Ltd. has mandated Deutsche Bank, Gazprombank, Goldman Sachs and Raiffeisen Bank International as bookrunners for a dollar-denominated issue of notes, a market source said.

A roadshow for the Rule 144A and Regulation S deal will begin Wednesday in London and Los Angeles and will travel to Boston before concluding on April 19 in Zurich, Geneva and New York.

Rwanda, Kexim tap banks

Rwanda has mandated BNP Paribas and Citigroup for a $350 million issue of notes, a market source said.

And the Export-Import Bank of Korea has mandated Barclays, Credit Agricole, Deutsche Bank, Standard Chartered Bank and UBS for a roadshow in Europe, a market source said.

A euro-denominated issue of notes is expected to follow.

Roadshow for KMG

Kazakhstan's KazMunaiGaz National Co. has mandated BofA Merrill Lynch, Barclays, Halyk Finance and Visor Capital to arrange a roadshow for a dollar-denominated issue of notes, a market source said.

The roadshow will begin Tuesday.

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

KazMunaiGaz is a gas company based in Astana, Kazakhstan.

EP Energy deal oversubscribed

The final book for Czech Republic-based energy producer EP Energy's recent €600 million notes due in 2018 that priced to yield 4 3/8% was €2.5 billion from 250 accounts, a market source said.

About 35% of the orders came from Germany, 31% from the United Kingdom and Ireland, 7% from France, 7% from Benelux, 6% from Italy, 6% from Switzerland and Liechtenstein, 3% from the non-U.S. Americas, 1% from the United States and 4% from others.

Fund managers picked up 86%, banks 7%, insurance 5% and others 2%.

Proceeds will be used to repay existing debt.

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