GarantiBank plans benchmark as soon as Tuesday; Petrobras to issue add-on; oil lifts LatAm

By Colin Hanner

Chicago, May 15 – The new issue pipeline opened up on Monday in the emerging market space, with Istanbul-based Turkiye Garanti Bankasi (GarantiBank) expected to offer Basel III-compliant tier 2 10-year benchmark bonds as soon as Tuesday, a market source said.

The financial services company held an investor call on Monday afternoon, a market source said.

BBVA, BofA Merrill Lynch, BNP Paribas, HSBC, Standard Chartered and Commerzbank are joint bookrunners for the deal.

Fitch Ratings assigned a preliminary rating of BB+ to the notes.

In March, GarantiBank priced a $500 million issue of six-year notes (Ba1//BBB-) at par to yield 5 7/8%, Prospect News reported.

As for other new deals expected to come to market soon, Senegal wrapped up investor meetings for a dollar-benchmark deal on Monday, and Nigeria’s Zenith Bank began investor meetings on Monday for a five-year dollar benchmark issue.

Petrobras plans add-ons

Petroleo Brasileiro SA is planning to offer additional 6 1/8% notes due 2022, 7 3/8% notes due 2027 and 7¼% notes due 2044, the company said in a 6-K filing with the Securities and Exchange Commission.

The notes will be sold via wholly owned subsidiary Petrobras Global Finance BV.

Each set of notes will be consolidated and form a single series with existing notes of similar terms.

Currently, Petrobras has $2 billion outstanding 2022 notes, $2 billion outstanding 2027 notes and $1 billion outstanding 2044 notes.

Proceeds from the notes will go toward redeeming existing 2¾% notes due 2018, 5 7/8% notes due 2018 and 4 7/8% notes due 2018, as well as paying down other existing debt and for general corporate purposes.

BB Securities Ltd., Banco Bradesco BBI SA, Citigroup Global Markets Inc., HSBC Securities (USA) Inc., Itau BBA USA Securities, Inc. and Morgan Stanley & Co. LLC will act as joint bookrunners for the deal.

Oil lifts LatAm

Worries of the global glut of crude oil were temporarily shelved on Monday in emerging markets, as Saudi Arabia and Russia agreed to support the Organization of Petroleum Exporting Countries extending supply cuts for another half-year, media sources said.

Crude oil shot up by several points on the news, which is thought of as a precursor to upcoming meetings on elongating the supply cut extension between other OPEC countries.

That news spread to trading in Latin American markets, where one market sources saw “retail buyers all over the place.”

Petroleos Mexicanos SAB de CV bonds were opening “3 to 5 basis points higher,” a market source said.

Its 6% notes due 2020 were quoted at 107.8 bid, 108.45 offered, while its 4 5/8% notes due 2022 were quoted at 103.85 bid, 104½ offered.

There was less changing hands in Mexico, which was “at least 2 [bps] tighter across the curve.”

The sovereign’s 5 1/8% notes due 2020 were quoted at 108.30 bid, 108.70 offered, and its 4 1/8% notes due 2026 were quoted at 104 bid, 104.4 offered.

Brazil’s 5 5/8% notes due 2019 were quoted at 106.55 bid, 106.90 offered, and its 6% notes due 2025 were quoted at 110.60 bid, 110.90 offered.

The 5% notes due 2045 were quoted at 91.45 bid, 92.2 offered.

Petroleos de Venezuela SA’s 8½% notes due 2017 were quoted with an 88 bid, 89 offer, a ½-point increase on the session.

Its 6% notes due 2026 were up ½ point to 38¼ bid, 39¼ offered.

Venezuela’s 9% notes due 2023 were up 1 point to 50 bid, 51 offered.

And its 9¼% notes due 2028 were up 1¾ points to a 48¼ bid, 49¼ offer.

© 2015 Prospect News.
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