Pemex, Akbank, Olam and Lippo Karawaci print bonds amid light volumes, some EM buying

By Christine Van Dusen

Atlanta, Oct. 15 - Mexico's Petroleos Mexicanos SAB de CV (Pemex), Turkey's AkBank TAS, Singapore's Olam International Ltd. and Indonesia's PT Lippo Karawaci TBK sold notes on a Monday with thin trading but some buyers seen for higher-yielding names.

"Volumes are light, as usual for a Monday," a London-based trader said.

In its new deal, petrochemical company Pemex printed a $1 billion add-on to its existing 5½% notes due June 27, 2044 at 110.911 to yield Treasuries plus 200 basis points, a market source said.

Deutsche Bank, Goldman Sachs and HSBC were the bookrunners for the Rule 144A and Regulation S deal.

The original $1.75 billion issue priced in June at 107.31 to yield 5.53%, or Treasuries plus 280 bps.

Proceeds will be used for general corporate purposes.

And Turkish lender AkBank priced a two-tranche issue of $1 billion notes due Oct. 24, 2017 and 2022, a market source said.

The deal included $500 million 3 7/8% notes due 2017 that priced at 99.672 to yield 3.948%, or Treasuries plus 328.1 bps.

The second tranche, $500 million 5% notes due 2022, priced at 99.001 to yield 5.129%, or Treasuries plus 345.2 bps.

Bank of America Merrill Lynch, Citigroup, HSBC, JPMorgan and Societe Generale were the bookrunners for the Rule 144A and Regulation S deal.

"Plenty of new issue activity in Turkey is grabbing people's attention," a trader said.

In trading, the recent issue of 2017 notes from Qatar International Islamic Bank was trading "OK" while Dubai Electricity and Water Authority's 2020s were almost unchanged, at 117.60. Saudi Electricity Co.'s 2022s were 21 bps wider on the month.

"They're still lagging a little," he said.

Olam, Lippo Karawaci do deals

Also on Monday, food processing company Olam International priced a S$400 million issue of 6% senior notes due Oct. 25, 2022 at par to yield 6% via Standard Chartered in a Regulation S transaction.

And development company Lippo Karawaci, through special-purpose vehicle Theta Capital Pte. Ltd., printed a $100 million increase of its 7% notes due May 16, 2019 at 105.25, a market source said.

Bank of America Merrill Lynch, Citigroup, Credit Suisse and Deutsche Bank were the bookrunners for the Regulation S deal.

Regal Hotels oversubscribed

The final book for the China-based Regal Hotels International Holdings Ltd.'s $300 million issue of 4¼% notes due Oct. 19, 2017 was $1.5 billion with more than 90 orders, a market source said.

The notes priced Friday at 99.444 to yield 4 3/8%, or Treasuries plus 370.5 bps via ANZ and JPMorgan in a Regulation S deal.

In other news from Asia, China-based property developer Yuzhou Properties Co. Ltd. is on a roadshow with BOCI, HSBC and UBS this week, a market source said.

No other details were immediately available on Monday.

Investcorp taps bookrunners

Bahrain-based investment company Investcorp SA has mandated Bank of America Merrill Lynch, Citigroup, Credit Suisse, ING, JPMorgan and RBS for a roadshow starting Oct. 17, a market source said.

A dollar-denominated issue of Rule 144A and Regulation S notes is expected to follow.

The marketing trip will be held in the Middle East, Asia, Europe and the United States.

PLN plans bonds

Indonesia-based electric company PT Perusahaan Listrik Negara (PLN) is planning up to $1 billion of notes, a market source said.

Barclays and Citigroup are the bookrunners for the deal, which was marketed on a roadshow that ended Monday.

And Russia's Bank of St. Petersburg set price talk at the 11% area for a $50 million-minimum issue of six-year bonds, a market source said.

BNP Paribas and UBS are the bookrunners for the Regulation S-only deal.

The notes are expected to price this week.

Bharat Petroleum on roadshow

In other deal-related news, India's Bharat Petroleum Corp. Ltd. is on a roadshow for a dollar-denominated issue of Regulation S notes, a market source said.

Citigroup, HSBC and RBS are the bookrunners for the deal.

The marketing trip began Monday in Singapore and will travel to Hong Kong before concluding on Wednesday in London.

And the City of Prague is planning a €200 million issue of 10-year notes, a market source said.

The deal is expected to come to the market in the first quarter of 2013.

No other details were immediately available on Monday.

HCFB plans marketing trip

Also on Monday, Russian lender Home Credit and Finance Bank (HCFB) was planning a roadshow for a dollar-denominated issue of notes via Citigroup, HSBC and Sberbank.

This came against the backdrop of rising prices for Russian eurobonds, according to a report from UFS Investment Co.

Prices for sovereign bonds have risen about 0.3%, while corporate notes have grown as much as 0.4%, the report said.

"The ruble corporate bond market again posted unclear trading dynamics," UFS said. "Players' attention is focused on the primary market."

Meanwhile, Evraz Group has ceased producing steel in the Czech Republic, which has proved to be neutral for the company's eurobonds, the report said.

Hungary bonds inch up

Hungary's bonds continued to benefit from the news that a deal with the International Monetary Fund is on the horizon, according to a report from Erste Group Research.

"We remain cautious," the report said. "After a strong rally, credit default swaps on Hungary also took [the news] with a pinch of salt and actually inched up 5 bps during Friday's trading session."

While Hungarian CDS has gone from more than 500 bps in July to about 300 bps, Croatia and Romania have seen their risk premiums drop about 15 bps, Erste Group said.

Ukraine rallies

Bonds from Ukraine also have rallied in trading, according to Svitlana Rusakova of Dragon Capital.

The sovereign's 2017s were seen up a point at about 106 bid, 107 offered, while the 2020s traded up at 101 bid, 102 offered, and the 2021s were seen at 102 bid, 103 offered.

"Naftogaz closed about 3/4-point higher at 101.5 bid, 102.5 offered," she said. "Corporate names predictably lagged behind."

First Ukrainian International Bank saw two-way flows at 98 bid, par offered.

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