Emerging Markets: Taiwan Semiconductor, Temasek, Egypt, AngloGold price; Atento cancels notes

By Rebecca Melvin

New York, Oct. 2 –Taiwan Semiconductor Manufacturing Co., Ltd. priced $3 billion of notes (Aa3/A+) due 2025, 2027 and 2030, and Temasek Holdings (Pvt) Ltd., an investment company based in Singapore, priced $2.75 billion of notes (Aaa/AAA) due 2030, 2051 and 2070 this past week in the emerging markets primary bond market.

The megadeals were joined by several other Southeast Asian sovereigns and corporates this past week that also priced tranches. Deals were also seen from the Egypt, which priced €750 million green senior notes due 2025 (B/B+), and AngloGold Ashanti Holdings plc, which priced $700 million of 3¾% notes due 2030 (Baa3/BB+/BBB-).

But the pace of issuance pulled back somewhat and there were some other signs of market volatility. On Friday, Latin America-focused Atento SA said its wholly owned subsidiary Atento Luxco 1 has decided to postpone a proposed private offering of senior secured notes due to unfavorable market conditions.

The company also postponed a concurrent cash tender offer for any and all of its 6 1/8% senior secured notes due 2022.

The issuer had intended to use proceeds from the new Rule 144A and Regulation S notes deal, together with cash on hand, to finance the tender, according to a company release.

It had selected Banco BTG Pactual SA-Cayman Branch, Itau BBA USA Securities Inc., Morgan Stanley, & Co. LLC, BB Securities Ltd. and BCP Securities LLC as dealer managers of the tender offer and Ipreo LLC as information agent and tender agent for the offer.

Atento thanked investors for their engagement in the process for the new notes and said it will review its options once market conditions stabilize.

Luxembourg-based Atento is a provider of customer relationship management and business process outsourcing services in Latin America.

Last week Zambia requested more time from its international creditors to meet its obligations. Rwanda has warned it is also struggling, and Lebanon began a restructuring process earlier this year, as Argentina and Ecuador reached agreements with their bondholders.

Market observers worry that another wave of economic distress this year could trigger further defaults. In a blog post published on Thursday, Kristalina Georgieva, the head of the International Monetary Fund, said that “the world is at a critical juncture,” and needs to review its arsenal of weapons “to prevent, and if necessary, pre-empt, another sovereign debt quagmire.”

“The alternative could be large-scale defaults that would severely damage economies and set back their recoveries for years,” Georgieva wrote.

Also on Thursday, the IMF released a report recommending reforms to ensure that countries needing debt restructuring can resolve those situations as quickly as possible.

Meanwhile, China is seeing its economic recovery progressing, according to reports. The improvement is being driven by a combination of consumption and increasing activity among the country’s smaller companies, and its spurring interest from international investors in China’s bond market, the world’s second largest. Bearing higher yields than their U.S. counterparts, Chinese government bonds yield close to 3%, and better run companies can yield 4% to 5%.

ADB prices $4 billion

Asian Development Bank priced $4 billion of three-year bonds and 10-year bonds, according to a market source on Tuesday.

The $3 billion tranche of ¼% bonds due 2023 priced at 99.893 to yield 0.286%, or a spread of 5 basis points over mid-swaps.

The $1 billion ¾% bonds due 2030 priced at 98.852 to yield 0.87% for a spread of 19 bps over mid-swaps.

RBC Capital Markets, Nomura, BNP Paribas and TD Securities were the bookrunners.

The bonds, which priced under the issuer’s global medium-term note program, are expected to be listed on the Luxembourg Stock Exchange’s regulated market.

The development bank is based in Manila.

A subsidiary of Beijing-based China Development Bank, China Development Bank Financial Leasing Co., Ltd. issued $700 million 2 7/8% 10-year tier 2 dated capital bonds (BBB+) on Monday, according to a notice.

Standard Chartered Bank, Bank of China, Bank of Communications, China Citic Bank International, HSBC, Mizuho Securities, ANZ, DBS Bank Ltd., Guotai Junan International, CMB International, China Minsheng Banking Corp. Ltd., Hong Kong Branch, KGI Asia, ABC International, J.P. Morgan and Citigroup are the joint lead managers and joint bookrunners for the Regulation S offering.

The offshore bonds are callable at the end of the fifth year, at which point the interest rate will be reset.

Listing of the bonds on the Stock Exchange of Hong Kong Ltd. will be effective Tuesday.

And China’s CCBL (Cayman) 1 Corp. Ltd. sold $300 million of notes in two parts.

There were $200 million of 1.78% notes due 2025 and $100 million of 2.55% notes due 2030.

The notes are guaranteed by CCB Leasing (International) Corp. DAC with the benefit of a keepwell deed by CCB Financial Leasing Corp. Ltd.

CCB International, Bank of Communications, Credit Agricole CIB, HSBC and Mizuho were the joint global coordinators, joint bookrunners and joint lead managers for the Regulation S deal.

ANZ, CMB International, Morgan Stanley MUFG and Shanghai Pudong Development Bank, Hong Kong Branch were joint bookrunners and joint lead managers.

The issuer is based in Beijing.

TSMC, Temasek price

Taiwan Semiconductor, through its wholly-owned TSMC Global Ltd., $1 billion of ¾% notes due 2025, $750 million of 1% notes due 2027 and $1.25 billion of 1 3/8% notes due 2030.

Bookrunners for the offering are Goldman Sachs International, J.P. Morgan Securities plc, Morgan Stanley & Co. LLC, Credit Agricole CIB and Citigroup Global Markets Inc.

The company plans to use the proceeds for general corporate purposes, according to Moody’s Investors Service.

The semiconductor manufacturer is based in Hsinchu, Taiwan.

Through its subsidiary Temasek Financial (I) Ltd., Temasek priced $2.75 billion of notes including a $750 million tranche of 1% 10-year notes priced at 98.821 for a yield of 1.125%, or spread over U.S. Treasuries of 47.5 bps; a $1 billion tranche of 2.25% 30.5-year notes priced at 98.368 for a yield of 2.325%, or a spread over Treasuries of 90 bps; and a $1 billion tranche of 2.5% 50-year notes priced at 99.292 for a yield of 2.525%, or a spread over Treasuries of 110 bps. It is Temasek’s first 50-year bond, further extending its debt maturity curve.

The joint lead managers of the Rule 144A and Regulation S notes were Barclays, Citigroup, DBS Bank Ltd., HSBC and Morgan Stanley.

The proceeds will be used to fund Temasek’s ordinary course of business. The notes are expected to be listed on the official list of the Singapore Exchange Securities Trading Ltd. on Oct. 7.

Temasek is an investment company based in Singapore.

AngloGold brings deal

The new $700 million deal issued by AngloGold and guaranteed by AngloGold Ashanti Ltd. priced at 99.678 to yield 3.789%, or a spread over U.S. Treasuries of 312.5 bps.

Joint bookrunners are Barclays, BMO Capital Markets, BNP Paribas, BofA Securities, CIBC Capital Markets, Citigroup, Deutsche Bank, JPMorgan, RBC Capital Markets, Scotiabank and Standard Chartered Bank. ANZ is a passive bookrunner.

The notes are callable prior to July 1, 2030 at a discount rate of Treasury plus 50 bps. After July 1, 2030 they are callable at par.

The notes feature a put at 101% in the event of a change of control that leads to a ratings downgrade.

AngloGold Ashanti is a Johannesburg-based gold producer.

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