Morning Commentary: Eldorado Brasil pulls notes offering; LatAm primary market in focus

By Rebecca Melvin

New York, Feb. 8 – The postponement of Eldorado Brasil Celulose SA’s proposed offering of senior notes leaves only one deal on the forward calendar for Latin America on Friday, but the new issue market for the region was still deemed to be positive, according to market sources.

Banco BTG Pactual SA is marketing a proposed tier 2 offering of 10-year subordinated notes, which are non-callable for five years.

“Recent pricings have been fairly positive for issuers. We’ve seen Credito Real and others, and it’s been a good start,” a New York-based market source said.

Mexico’s Credito Real SAB de CV Sofom ER priced $400 million of 9½% notes due 2026 (//BB+) at par on Feb. 1, and those notes rose in after-market action.

The situation surrounding the Eldorado deal was company specific and unrelated to market conditions, the source said.

“The market is looking much stronger,” the source said, adding that he expects a number of companies to take advantage of current conditions especially after being faced last year with periods of time when the new issue window was essentially closed due to market and currency woes.

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