Cordoba sells notes; EM mixed on U.S. data; Ecopetrol climbs; Nigeria, Los Grobo advance deals

By Christine Van Dusen

Atlanta, June 3 – The Province of Cordoba sold notes on Friday as weak employment data from the United States led to mixed performance from emerging markets assets.

The U.S. economy in May added fewer jobs than it had in more than five years, led by drops in construction and manufacturing employment. That, market sources say, could make it more difficult for the Federal Reserve to bump up rates.

“Varying degrees of performance once again, as weak [data] weakens the Fed’s case for a rate move, spurring Latin America credit higher,” a New York-based trader said.

Colombia-based Ecopetrol SA, for one, moved up as much as 1½ points while most other names were lifted by about a ½ point, he said.

“Clearly better buying from all account bases,” he said. “The institutional base is coming back in to buy after a mostly subdued May.”

Banks from Colombia moved higher while Mexican high-grade names and banks were “stuck in neutral,” he said.

“Currently valuations are viewed as stretched,” he said.

Mexico-based Cemex SAB de CV realized some small gains across the curve, he said, and Brazil’s corporates were higher, led by Gerdau SA.

Meanwhile, investors were keeping an eye on oil after the Organization of Petroleum Export Countries (OPEC) failed to cap production.

This had a “limited effect on the market, as oil prices were supported by the U.S. production decline,” according to a report from Schildershoven Finance BV. “The initial reaction to the announcement was negative, as oil has started to decline. However, prices were supported after the U.S. production and inventory data were announced.”

Cordoba sells notes

In its new deal, Cordoba priced $725 million 7 1/8% notes due June 10, 2021 at par to yield 7 1/8%, a market source said.

The notes were talked at a yield in the mid-7% area.

JPMorgan and Morgan Stanley were the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used to fund a tender offer and to finance infrastructure projects.

In the tender offer, the province is offering to purchase up to $200 million principal amount of its $596 million outstanding 12 3/8% senior notes due 2017, according to a news release.

The province is offering $1,082.50 per $1,000 principal amount of notes plus accrued interest up to but excluding the payment date, which is expected to be June 10.

The tender offer will expire at 5 p.m. ET on June 2.

Nigeria plans roadshow

Nigeria will host a roadshow the week of June 6 for a dollar-denominated issue of notes, a market source said.

Standard Chartered is the bookrunner for the deal.

Other details were not immediately available on Friday.

Los Grobo seeks issuance

Argentina’s Grupo Los Grobo is looking to issue dollar-denominated notes, a market source said.

Other details were not immediately available on Friday.

The issuer is a Buenos Aires-based agribusiness.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.