Deals from Gazprombank, Far East Horizon, Bharat Petroleum; Turkey widens; Middle East strong

By Christine Van Dusen

Atlanta, Feb. 26 - Russia's OJSC Gazprombank, China's Far East Horizon Ltd. and India's Bharat Petroleum Corp. Ltd. sold notes on a weaker Wednesday for most emerging markets assets.

Bonds from Turkey and Russia were 5 basis points to 10 bps wider on the long end, a London-based analyst said.

The new $750 million issue of 4.96% notes due 2019, which Gazprombank priced at par to yield 4.96% with BofA Merrill Lynch, ING, Gazprombank and JPMorgan, traded up 25 cents on Wednesday.

But elsewhere in the Russian corporate market, sellers abounded, putting pressure on long-dated paper from OJSC Gazprom and Sberbank, she said.

Other areas of emerging markets were stronger, however. The Middle East "retains a strong footing," a London-based trader said.

"Dubai Electricity and Water Authority's 2020 is powering along, 50 bps tighter on the month," he said. "Good interest on this one."

And Kuwait Projects Co.'s (Kipco) recent $500 million issue of 4.8% notes due 2019 that priced at par was bid Wednesday at 104.

The notes came to the market at mid-swaps plus 314.4 bps via BNP Paribas, HSBC and JPMorgan in a Regulation S deal.

"What a performance by this little bond," the trader said.

Another strong performer was the new 2019 bond from Abu Dhabi Commercial Bank PJSC. The $750 million 3% notes due 2019 printed Wednesday at 100 3/8, he said.

The deal attracted more than $3.25 billion in orders, with 36% from the United Kingdom, 35% from the Middle East and North Africa, 16% from other Europe and 13% from Asia, a market source said.

The notes priced at 99.765 to yield mid-swaps pus 140 bps with BofA Merrill Lynch, Barclays, ING and JPMorgan in a Regulation S deal.

Fund managers picked up 48%, banks and private banks 37%, agencies 10% and others 5%.

Qatar bonds perform

In other trading from the Middle East, Qatar was an outperformer, with only buyers spotted, a trader said.

"This has led Qatar Telecommunications Co. higher and tighter again," he said. "I still think the Qatar 2040s and 2042s can perform a little from here, versus the belly of the curve."

Perpetuals were, once again, mixed, with lackluster performance from Dubai Islamic Bank, he said.

"The market is craving more supply," he said. "However, it looks like March at this stage before there's anything further."

Africa in focus

Looking to Africa, Nigeria's bonds were solid, with the 2023s printing at 101 and the 2021s at 1053/4, a trader said.

"Ghana is nicely higher and tighter by about 40 bps to 50 bps on the week," he said. "Better buyers for choice across all of the South Africa corporate space."

Angola moved back to a 107 handle, he said, while demand remained strong for Egypt and Morocco.

Far East prices notes

China's Far East Horizon priced a $400 million issue of 4 5/8% notes due 2017 at 99.931 to yield 4.65%, or Treasuries plus 395 bps, a market source said.

Standard Chartered Bank, HSBC and Citigroup were the bookrunners for the deal.

Far East Horizon is a financial leasing unit of Sinochem Group, which is a Hong Kong-based business conglomerate with interests in agriculture, energy, chemicals, real estate and finance.

New deal from Bharat

India-based oil and gas company Bharat Petroleum sold CHF 175 million 3% notes due 2019 at 100.073 to yield 2.988%, or mid-swaps plus 235 bps, a market source said.

BNP Paribas, Deutsche Bank, RBS and UBS were the bookrunners for the Regulation S deal.

CLP Power sets roadshow

China's CLP Power Hong Kong Ltd. will set out on a roadshow for a possible issue of notes, a market source said.

HSBC is arranging the investor update.

No other details were immediately available on Wednesday.

Sri Rejeki seeks issuance

Indonesia's PT Sri Rejeki Isman Tbk is looking to issue $350 million of notes, a market source said.

Barclays is the bookrunner for the deal.

The issuer is an Indonesian manufacturer of textiles.

Metalloinvest eyed

Russia-based mining and metals company Metalloinvest JSC received some attention on Wednesday after Standard & Poor's upgraded the name to BB from BB-, the analyst said.

"The upgrade has been driven by more predictable financial policies and an improved debt maturity profile," she said. "Metalloinvest has long been one of our top picks in the metals and mining sector due to its very strong EBITDA margin and lower secured funding levels."

A potential initial public offering also holds promise, she said.

"The proceeds of such a move would be used to reduce debt," she said.

The company's 2020s were trading Wednesday at z-spread plus 420 bps.

Chalco oversubscribed

The final book for China Aluminum International Engineering Corp. Ltd.'s (Chalco) new $300 million issue of 6 7/8% perpetual notes that priced at par was about $1.8 billion, a market source said.

The notes came to the market at a yield of 6 7/8%, or Treasuries plus 615.2 bps, via Morgan Stanley and CLSA in a Regulation S deal.

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