Mexico's America Movil does two deals; China's Shui On prints bonds; Olympics thin volumes

By Christine Van Dusen

Atlanta, July 30 - Mexico's America Movil SAB de CV priced two deals and China's Shui On Development (Holding) Ltd. sold notes on a Monday that saw limited activity due to the Olympics, Ramadan and summer vacations.

"Patchy and thin markets overall," a London-based trader said. "Levels and prices were totally determined by the inquiry and Street positions, which are similar in many cases. Obviously that's all to be expected."

Also contributing to the slower day were ongoing worries about the global economic picture.

"The global backdrop is not exactly rosy, and for choice I saw better sellers of certain names," the London trader said. "Then, against that, fund flows are very supportive, but they too can also change."

In trading, some bonds from Poland reacted positively to bailout-supportive statements from the European Central Bank, according to a report from Erste Group.

"Friday's trading session was dominated by hope of political support for more forceful action from the ECB with regard to the elevated yield levels of Spanish and Italian debt," the report said. "The biggest beneficiaries of this development in [Central Europe and Europe] fixed income markets have been Polish local currency government benchmark bonds, where yields fell between 6 and 15 basis points."

The ECB is expected to hold the policy rate unchanged at its meeting on Thursday, according to a report from Barclays Capital.

"So the focus will be whether it makes changes to the collateral framework and whether the bond purchase program will be reactivated," the report said. "Market expectations appear to be high and any disappointment at Thursday's meeting is likely to be met with an aggressive reversal in the risk asset rally."

Movil sterling, dollar notes

In the first of its two new deals on Monday, telecommunications company America Movil sold £750 million 4 3/8% notes due Aug. 7, 2041 at 97.828 to yield 4.511%, according to a company filing. Deutsche Bank was the bookrunner for the Securities and Exchange Commission-registered deal.

The company also priced a two-tranche $750 million tap of its senior notes due 2022 and 2042 via Citigroup and Morgan Stanley. The SEC-registered deal included $350 million 3 1/8% notes due July 16, 2022 that priced at 102.623 to yield 2.82%, or Treasuries plus 131 bps. The second tranche, $400 million 4 3/8% notes due July 16, 2042, priced at 104.601 to yield 4.016%, or Treasuries plus 153 bps.

The original issues priced on July 9, with $1.25 billion 3 1/8% bonds due 2022 coming to the market at 99.49 to yield 3.185%, or Treasuries plus 168 bps. A $750 million tranche of 4 3/8% bonds due 2042 priced at 99.244 to yield 4.482%, or 188 bps over Treasuries.

Proceeds will be used to repay debt.

Shui On prices add-on

In another new deal on Monday, Shui On Development - part of Shanghai-based property developer Shui On Land Ltd. - priced a $400 million add-on to its 9¾% notes due 2015 at 102.785, according to a syndicate source.

Deutsche Bank, Standard Chartered Bank and UBS were the bookrunners.

Shui On originally priced $400 million of the notes on Feb. 9 and a $75 million tap on Feb. 2.

"Supply-wise, the deals this month have been, for the most part, eaten up, and we are probably virtually closed now until the end of August," a trader said. "So it's a good market at the moment, with differing views and approaches, albeit limited depth on either side of the market, with dealing desks short-staffed and dealer interest and ability to run large positions low."

Sinotruk notes oversubscribed

In other news from Asia, the final book for the RMB 1.8 billion 4½% notes due Aug. 1, 2014 that Sinotruk Hong Kong Ltd. priced late on Friday was more than RMB 2.5 billion from more than 46 investors, a market source said.

The notes priced at par to yield 4½% via Bank of China, IBCA, Morgan Stanley and RBS in a Regulation S-only deal.

About 69% of the orders came from Hong Kong, 17% from China, 10% from Singapore and 4% from Europe and others. Banks accounted for 55%, fund and asset managers 22%, sovereigns and quasi-sovereigns 17% and private banks 6%.

Unibanco sets guidance

Also on Monday, Brazil-based lender Itau Unibanco Holding SA set initial guidance at the mid- to high-5% area for a planned issue of dollar-denominated notes due 2022, a market source said.

Itau, JPMorgan and Standard Chartered are the bookrunners for the Rule 144A and Regulation S deal.

And real estate company Bahrain Mumtalakat Holding is planning an issue of Malaysian ringgit-denominated notes, a market source said.

CIMB and Standard Chartered Bank are the bookrunners for the deal.

A roadshow is coming up.

Access Bank well bid

In the secondary market, the recent issue of $350 million 7¼% notes due 2017 from Nigeria's Access Bank plc that priced at par opened on Monday at 99.12 bid, 100.12 offered after trading Friday at 98.62 bid, 99.62 offered.

On Thursday the notes were quoted at 98.50 bid, 99 offered.

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

In other trading, Abu Dhabi-based Aldar Properties' 2014 notes opened at 109.50 bid, 110.25 offered.

"That's 40 bps tighter on the week," a trader said.

Bond from Lebanon "remain in a decent period of illiquidity," he added.

Jafza trades up

The recent deal from Dubai's Jebel Ali Free Zone (Jafza) - a $650 million issue of 7% notes due 2019 that priced at par - opened Monday at 106 bid, 107 offered.

On Friday the notes were trading at 105.75 bid, 106.75 offered after being quoted on Thursday at 105.50 bid, 106 offered.

Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Citigroup, Dubai Islamic Bank, Emirates NBD, National Bank of Abu Dhabi and Standard Chartered were the bookrunners for the Regulation S deal.

"One space that still trades well is Dubai incorporated," a trader said. "It was a solid day for Emaar Properties, Jafza and Majid al Futtaim Holdings all closing the best part of 6 bps to 10 bps tighter."

Qatar notes in focus

The $4 billion sukuk issue from Qatar funding vehicle SoQ Sukuk was in focus on Monday.

The deal included $2 billion 2.099% notes due 2018 and $2 billion 3.241% notes due 2023 that both priced at par.

The 2018 notes traded Monday at 100.50 bid, 100.65 offered after Friday's levels of 100.50 bid, 105.50 offered. The 2023 notes were quoted Monday at 102.57 bid, 102.97 offered after trading Friday at 102.55 bid, 102.95 offered.

Barwa Bank, Deutsche Bank, HSBC, QInvest and Standard Chartered Bank were the bookrunners for the Regulation S deal.

Aleesia Forni contributed to this article.

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