Emerging Markets: Abu Dhabi returns for $5 billion of notes; Bermuda, Coca-Cola Femsa, Tencent price

By Rebecca Melvin

New York, Aug. 28 – The week’s largest new deal by the Emirate of Abu Dhabi was the centerpiece of the emerging markets primary market this past week, with a number of small and larger Asia deals and Latin America representation from Bermuda and Mexico’s Coca-Cola Femsa SAB de CV, according to Prospect News’ data.

Abu Dhabi tapped the market for a huge $5 billion deal of notes in three tranches, including a new 50-year bond due in 2070.

The Gulf Cooperation Council country’s latest issuance represents its third foray into the capital markets this year. In April, the sovereign priced $7 billion of notes of five-, 10- and 30-years duration and then it added-on $3 billion to those tranches in May.

Its latest deal, which priced on Wednesday, included $2 billion of ¾% notes due 2023, $1.5 billion of 1.7% notes due March 2, 2031, and $1.5 billion 2.7% notes due 2070.

Also on Wednesday, Bermuda priced $1.35 billion of senior notes in four parts, according to a press release.

The parts include $382,105,000 of 2 3/8% Rule 144A notes due Aug. 20, 2030, $391,596,000 of 3 3/8% Rule 144A notes due Aug. 20, 2050, $292,895,000 of 2 3/8% Regulation S notes due Aug. 20, 2030 and $283,404,000 of 3 3/8% Regulation S notes due Aug. 20, 2050.

Mexico’s Coca-Cola Femsa sold $705 million of 1.85% green senior notes due Sept. 1, 2032 (A2/BBB+/A-). The issue priced at 99.604 for a 1.887% yield, or a spread over Treasuries of plus 120 basis points.

The notes will be guaranteed by Propimex, S de RL de CV, Comercializadora La Pureza de Bebidas, S de RL de CV, Grupo Embotellador Cimsa, S de RL de CV, Refrescos Victoria del Centro, S de RL de CV, Distribuidora y Manufacturera del Valle de Mexico, S de RL de CV, Yoli de Acapulco, S de RL de CV and Controladora Interamericana de Bebidas, S de RL de CV.

The notes were talked to price in the Treasuries plus 155 bps area with guidance tightened to Treasuries plus 125 bps.

The deal was upsized from $500 million.

BofA Securities, Inc., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC were the bookrunners.

The company held fixed income investor calls for the issue on Tuesday.

Proceeds will be used to finance or refinance eligible green projects.

Coca-Cola Femsa is a beverage company based in Mexico City.

Nanshan, Shenzhen, China-based music streaming service Tencent Music Entertainment Group priced $800 million two-parts of senior notes (A2/A/A) on Wednesday. The deals included $300 million of 1 3/8% five-year notes at 99.928 to yield 1.39%, or a spread of Treasuries plus 110 bps, and $500 million of 2% 10-year notes at 99.595 to yield 2.045% and with a 135 bps over Treasuries spread.

The 2025 notes were initially talked at 155 bps spread area and the 10-year notes were talked to price in the Treasuries plus 180 bps area.

The proceeds of the offerings are earmarked for general corporate purposes. Joint bookrunners were BofA Securities, Inc., J.P. Morgan Securities LLC, Goldman Sachs (Asia) LLC and Morgan Stanley & Co. LLC.

The joint lead managers included Bank of China (Hong Kong) Ltd., Credit Suisse Securities (USA) LLC, Deutsche Bank AG, Hong Kong Branch, Hongkong and Shanghai Banking Corp. Ltd. and Mizuho Securities Asia Ltd.

The company is a joint venture between Tencent Holdings Ltd. and Spotify AB.

Asian Development Bank priced $3 billion of 3/8% five-year notes (Aaa/AAA) on Tuesday at mid-swaps plus 11 bps, or a Treasuries plus 15.4 bps spread, according to a market source.

The notes were guided to print at the mid-swaps plus 11 bps area.

BofA Securities, Inc., Credit Agricole CIB, Citigroup Global Markets Ltd. and J.P. Morgan Securities plc were the lead managers.

Asian Development Bank is a Mandaluyong, Philippines-based regional development bank.

ICBCIL Finance Co. Ltd. issued $900 million of 1¾% notes due 2025.

The notes for the Beijing-based financial company were issued out of the $20 billion medium-term note program that has benefit of a keepwell and liquidity support deed by ICBC Financial Leasing Co., Ltd.

ICBC, ANZ, Bank of China, Bank of Communications, BNP Paribas, CCB International, Goldman Sachs (Asia) LLC, HSBC, J.P. Morgan and Mizuho Securities are the joint global coordinators, joint bookrunners and joint lead managers.

Abu Dhabi prices $5 billion deal

Abu Dhabi’s $2 billion of ¾% notes due 2023priced at 99.763 to yield 0.83%, or a spread of 65 bps over U.S. Treasuries.

The sovereign’s $1.5 billion of 1.7% notes due March 2, 2031 – a long 10-year note – priced at 99.694 to yield 1.732% or a yield spread of 105 bps over Treasuries.

The $1.5 billion of 2.7% notes due Sept. 2, 2070 priced at par for a spread over Treasuries of 130.6 bps.

Order books were more than $24 billion at the time the Rule 144A and Regulation S tranches were launched on Tuesday.

Citigroup, Deutsche Bank, First Abu Dhabi Bank, Morgan Stanley and Standard Chartered Bank were bookrunners of the deal.

The notes will be listed on the London Stock Exchange and Abu Dhabi Securities Exchange.

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