Primary sees Videsh, Pacific International, Noble Group, Kookmin; Bahrain, Kuwait suffer

By Christine Van Dusen

Atlanta, July 7 – India’s ONGC Videsh Ltd., Singapore’s Pacific International Lines, China’s Noble Group Ltd. and South Korea’s KB Kookmin Bank sold notes on a Monday that saw patchy liquidity for emerging markets assets as the summertime mood began to set in.

“Real summery feel in the markets ... with an air of thinness prevailing,” a London-based trader said. “The Tour De France rolling through London also took some attention away from the screens later in the day.”

Spreads fared well, tightening along with rates, he said, and trading was active for perpetual bonds from the Middle East.

“Still, a few names have been beaten up lately on the back of the ISIS developments,” he said. “The biggest losers have been Bahrain and Kuwait names.”

Bonds from Central and emerging Europe opened somewhat firmer on Monday as the conflict in Ukraine appeared to be easing, a London-based analyst said.

“The tide does appear to be turning,” she said. “The rebels asked for Russian assistance over the weekend, but there was no response from Moscow, implying their concerns over possible sanctions. There remains the risk, however, that the deaths of citizens in the fighting could still push Russia to become involved.”

In response, the sovereign’s 2030s underperformed the 2019s, she said.

In deal-related news, China’s Huarong Finance Co. Ltd. and China National Gold Group Corp. were on roadshows, and Bahrain was looking to issue euro-denominated notes.

Shipper issues notes

Singapore’s Pacific International Lines sold S$300 million 5.9% notes due July 17, 2017 at par to yield 5.9%, a market source said.

Credit Suisse, DBS Bank and Standard Chartered Bank were the bookrunners for the Regulation S deal.

The issuer is a shipping company.

Videsh prints bonds

India’s ONGC Videsh – a subsidiary of Oil and Natural Gas – priced $1.5 billion notes due July 15 of 2019 and 2024 and €525 million due July 15 of 2021, a market source said.

The deal included $750 million 3¼% notes due 2019 that priced at 99.598 to yield 3.338%, or Treasuries plus 160 basis points. The notes were talked at a spread of Treasuries plus 160 bps to 165 bps.

The $750 million 4 5/8% notes due 2024 priced at 99.454 to yield 4.694%, or Treasuries plus 207.5 bps. Talk was set at Treasuries plus 207.5 bps to 212.5 bps.

The €525 million 2¾% notes due 2021 priced at 99.623 to yield 2.81%, or mid-swaps plus 180 bps. The notes were talked at mid-swaps plus 180 bps to 185 bps.

BNP Paribas, Citigroup, Deutsche Bank, RBS and Standard Chartered Bank were the bookrunners for the Regulation S deal.

The proceeds will be used to refinance loans.

ONGC is based in Dehradun, India.

Kookmin prices bonds

South Korea’s Kookmin Bank sold $500 million 1 5/8% notes due July 14, 2017 at 99.718 to yield 1.722%, or Treasuries plus 75 bps, a market source said.

The notes were talked at a spread of 75 bps to 80 bps.

Barclays, BNP Paribas, BofA Merrill Lynch, Citigroup and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

The lender is based in Seoul.

Noble offers add-on

China’s Noble Group priced a $50 million add-on to its 6% perpetual notes at 101, according to a company announcement.

A $350 million issue of the notes previously priced at par to yield Treasuries plus 426 bps.

BofA Merrill Lynch was the bookrunner for the Regulation S deal.

The proceeds will be used for general corporate purposes and for the refinancing of the company’s 8½% perpetual capital securities issued on Nov. 1, 2010.

Noble Group is a Hong Kong-based conglomerate that focuses on raw materials.

Huarong on roadshow

China’s Huarong Finance set out on Monday for a roadshow to market a dollar-denominated issue of notes, a market source said.

Credit Suisse, Standard Chartered Bank, Wing Lung Bank and ICBC (Asia) are the bookrunners for the Regulation S deal.

Chinese corporate markets notes

China National Gold Group set out on Monday for a roadshow to market a dollar-denominated issue of notes, a market source said.

Standard Chartered Bank, Citigroup, BofA Merrill Lynch and CCB International are the bookrunners for the Regulation S deal.

The roadshow is being held in Hong Kong, London and Singapore.

Bahrain seeks issuance

Bahrain is looking to issue euro-denominated notes, a market source said.

No other details were immediately available on Monday.

Chinese corporate prints notes

On Friday, Hong Kong Science and Technology Parks Corp. priced a two-tranche issue of HK$1.707 billion notes due July 11, 2019 and 2024, a market source said.

The deal included HK$855 million 2.12% notes due 2019 that priced at par to yield 2.12% and HK$852 million 3.2% notes due 2024 that priced at par to yield 3.2%.

ANZ, CCB International and Standard Chartered Bank were the bookrunners for the Regulation S deal.

VTB does deal

On Thursday, Russia’s VTB Bank – through VTB Capital SA Luxembourg – sold CHF 350 million 5% notes due Oct. 24, 2024 at par to yield 5%, a market source said.

Credit Suisse, UBS and VTB Capital were the bookrunners for the Regulation S deal.

This was the largest non-domestic tier 2 transaction in the Swiss franc market, according to a company announcement.

VTB is a Moscow-based lender.

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