Santander, China SCE Property, Sasol, others do deals; spreads tighten on election day

By Christine Van Dusen

Atlanta, Nov. 6 - Even as Election Day overtook the United States and captured investors' attention on Tuesday, new deals were brought to the market by several emerging markets issuers, including Banco Santander Mexico SA, China SCE Property Holdings Ltd. and South Africa's Sasol Financing International plc.

Also printing new notes were Caribbean Development Bank and Peru's Ajecorp BV.

Other emerging markets names readied deals for the market. On that list were Brazil's Sifco SA, Republic of Serbia, Vietnam's Vingroup JSC, Dominican Republic-based Latin American Airports Holdings and South Africa's FirstRand Bank Ltd.

"It's generally a positive tone, with spreads tighter," a London-based trader said. "All eyes are on the US election overnight, and ideally we have some sort of clarity tomorrow morning about the victor. A protracted, controversial and legally disputed result will not be received too well by the market."

In trading, Abu Dhabi National Energy Co.'s (TAQA) had a good bid, and International Petroleum Investment Co. saw steady activity. Investors also showed some interest in Dubai Electricity and Water Authority's 2020s, which were 4 basis points tighter, and Dubai's 2020s.

"They're 15 bps tighter," the London trader said.

He was also keeping an eye on Abu Dhabi Islamic Bank, which recently announced its intention to issue up to $5 billion of bonds. The notes are expected to be perpetual.

"Very interesting one, and no real comparable name in the Gulf region marketplace," he said. "With the bond not being rated - yet from a well-known, regarded and steady bank - it may exclude many regional players who have tight rating and investment criteria. However, as we have seen from non-senior deals recently from Latin America and Russia, there is a decent pool of money to buy these assets."

Sasol sells notes

In its new deal, South African mining and chemical company Sasol sold $1 billion 4½% notes due Nov. 14, 2022 at 99.048 to yield Treasuries plus 287.5 bps via Barclays, HSBC and JPMorgan in a Securities and Exchange Commission-registered deal.

Proceeds will be used for general corporate purposes, including capital expenditures and the development of the company's pipeline, according to a filing with the SEC.

And Barbados-based Caribbean Development Bank priced $300 million 4 3/8% notes due 2027 at par to yield 4 3/8%, or Treasuries plus 264.7 bps, a market source said.

RBC Capital was the bookrunner for the deal.

Ajecorp prints bonds

In another new deal, Peruvian beverage company Ajecorp printed a $150 million add-on to its existing 6½% notes due May 14, 2022 at 109.257 to yield 5¼%, a market source said.

Bank of America Merrill Lynch was the bookrunner for the Rule 144A and Regulation S deal.

And Banco Santander Mexico priced a $1 billion issue of 4 1/8% notes due Nov. 9, 2022 at 98.183 to yield Treasuries plus 260 bps.

The notes were talked at Treasuries plus 250 bps to 275 bps.

Banco Santander Mexico is based in Mexico City.

SCE prices notes

Tuesday also saw property developer China SCE Property Holdings sell $200 million 11½% notes due Nov. 14, 2017 at par to yield 11½%, a market source said.

The notes were talked at the 11¾% area.

Deutsche Bank and HSBC were the bookrunners for the Regulation S notes, which are non-callable for three years.

Proceeds will be used to finance new and existing projects and for general corporate purposes.

Issuance from Southern Copper

These new deals followed the Monday pricing of Phoenix-based and Latin America-focused Southern Copper Corp.'s $1.5 billion two-tranche issue of 10- and 30-year notes in an SEC-registered deal, according to an FWP filing with the SEC.

The deal included $300 million 3½% notes due 2022 that priced at 99.657 to yield 3.541%, or Treasuries plus 185 bps.

A $1.2 billion 30-year tranche of 5¼% notes priced at 98.207 to yield 5.371%, or Treasuries plus 250 bps.

Bank of America Merrill Lynch, Credit Suisse Securities, HSBC and Morgan Stanley were the bookrunners for the notes.

Proceeds are to be used for general corporate purposes, including financing of the company's capital program.

Hutchison Whampoa prints deal

The market also was digesting Hong Kong-based conglomerate Hutchison Whampoa's $1.5 billion issue of notes due Nov. 8, 2017 and 2022, a market source said.

The first tranche, $1 billion 2% notes due 2017, priced at 99.768 to yield Treasuries plus 135 bps. The second tranche, $500 million 3¼% notes due 2022, priced at 99.484 to yield Treasuries plus 162.5 bps.

Bank of America Merrill Lynch, Citigroup, Goldman Sachs and HSBC were the bookrunners for the Rule 144A and Regulation S deal.

QGOG oversubscribed

The final book for Brazil-based QGOG Constellation SA's $700 million issue of 6¼% notes due Nov. 9, 2019 was more than $3 billion with about 200 accounts involved, a market source said.

The notes priced Monday at 98.612 to yield 6½% via HSBC, Bank of America Merrill Lynch and Citigroup in a Rule 144A and Regulation S deal, according to a company release.

Proceeds from the offering will be used to repay short-term debt and for general corporate purposes.

QGOG is a Rio de Janeiro-based provider of off- and on-shore drilling in Brazil through subsidiary Queiroz Galvao Oleo e Gas SA.

Chilean bank attracts orders

Also oversubscribed was Banco del Estado de Chile's $500 million issue of 2% notes due Nov. 9, 2017 that priced at 99.65 to yield Treasuries plus 137.5 bps.

Citigroup, Deutsche Bank, HSBC and JPMorgan were the bookrunners for the Rule 144A and Regulation S deal.

The final book was more than $1 billion with about 100 accounts involved.

Itau Unibanco in demand

In another popular deal, Brazil's Itau Unibanco Holding SA sold $1.7 billion 5 1/8% notes due May 13, 2023 at par to yield 5 1/8%, or Treasuries plus 343 bps.

The books were more than $6.5 billion with about 300 accounts involved, a market source said.

BB Securities, Itau Unibanco, JPMorgan and Santander were the bookrunners for the Rule 144A and Regulation S deal.

The Sao Paulo-based lender will use the proceeds for general corporate purposes.

Sifco sets talk

In deal-related news, Brazil-based automotive component manufacturer Sifco gave guidance in the 12¾% area for its planned $200 million notes due May 2018.

Citigroup, Goldman Sachs and Banco Pine are the bookrunners for the Rule 144A and Regulation S deal.

The notes are expected to price on Wednesday.

Serbia taps agents

And Serbia mandated Deutsche Bank, HSBC and VTB Capital for a roadshow from Wednesday until Nov. 12, a market source said.

The roadshow will begin in San Francisco and Los Angeles, then travel to New York and Boston before concluding in London.

A Rule 144A and Regulation S deal may follow, subject to market conditions.

Vingroup plans roadshow

Vietnam-based tourism and real estate management company Vingroup is planning a roadshow for a dollar-denominated issue of notes via Citigroup, a market source said.

The roadshow for the Regulation S deal will begin on Wednesday and travel to Hong Kong, Singapore and London.

And Dominican Republic-based Latin American Airports Holdings has set the size at $500 million and the tenor at seven years for its planned issue of notes.

JPMorgan is the bookrunner for the Rule 144A and Regulation S notes.

FirstRand taps bookrunners

South Africa's FirstRand Bank Ltd. has mandated JPMorgan, Standard Chartered Bank, RBS, Rand Merchant Bank and Morgan Stanley for a Regulation S deal, a market source said.

The notes will be marketed during a roadshow starting Nov. 12 in Geneva and Zurich, then traveling to London on Nov. 13 and Singapore on Nov. 14.

FirstRand Bank is a wholly owned subsidiary of FirstRand Ltd., a financial services company based in Johannesburg.

Calik Holding cancels plans

Turkey's Calik Holding AS has postponed its planned $300 million issue of five-year notes, a market source said.

The notes had been talked at 10¼% to 10½%.

Citigroup and Goldman Sachs were the bookrunners for the Rule 144A and Regulation S deal.

Proceeds were to be used to refinance existing debt.

Calik, an Istanbul-based industrial conglomerate, had initially planned to do a dollar-denominated deal in May but postponed the offering due to market conditions.

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