Emerging Markets: Ooredoo prices $1 billion notes; Nogaholding, Pakistan also bring deals

By Rebecca Melvin

New York, April 1 – Emerging markets debt issuance remained strong this past week as the March calendar drew to a close and as many regions observed the Holy Week holiday. U.S. bond markets have an early close on Friday in observance of Good Friday.

Gulf Cooperation Council corporates were in the space issuing bonds early in the holiday-shortened week. Ooredoo QPSC, Oil & Gas Holding Co. BSC (Nogaholding) and Arabian Centres Co. were all pricing deals. And representing sovereigns, Pakistan also brought a triple-tranche deal for the MENA region.

Ooredoo International Finance Ltd. priced $1 billion of 2 5/8% 10-year notes (expected: A2/A-/A-) at 98.922 to yield mid-swaps plus 100 basis points on Wednesday, according to a market source.

The notes priced in line with the launch level of mid-swaps plus 100 bps and tighter than both final guidance of mid-swaps plus 110 to 115 bps and initial talk of mid-swaps plus 125 to 135 bps.

The offering was more than 3.4 times oversubscribed, according to an announcement from the issuer.

Citigroup, Barclays, BNP Paribas, Credit Agricole CIB, DBS Bank Ltd., Mizuho, QNB Capital and Standard Chartered were joint lead managers and joint bookrunners for the Rule 144A and Regulation S deal. Citi will bill and deliver.

The deal was sold from the company’s global medium-term note program and will be listed on the Irish Stock Exchange.

“It has been five years since our last bond issuance. We are delighted to see very strong demand from the U.S., Europe, Asia and the Middle East for Ooredoo’s recent bond issuance, which demonstrates the high level of confidence that the investors have in Ooredoo’s robust performance and strategy,” said Aziz Aluthman Fakhroo, managing director, Ooredoo Group, in an announcement.

Ooredoo is the Doha, Qatar-based telecommunications company formerly known as Qtel International.

Bahrain’s Nogaholding priced a $600 million eight-year Islamic bond on Wednesday at par, according to a notice.

J.P. Morgan Securities plc, Gulf International Bank, HSBC and BNP Paribas managed the deal with JPMorgan as coordinator.

The sukuk was sold under Rule 144A and Regulation S.

Nogaholding is the state-owned strategic investment and development arm of the sovereign’s oil and gas authority.

Arabian Centres launched a $650 million 5.5-year sukuk (expected rating: Ba2//) at a yield of 5 5/8% on Tuesday, according to market sources.

Pricing was tightened from initial guidance of a 5 7/8% yield.

Arabian Centres Sukuk II Ltd. was the issuer of the sukuk, and proceeds are expected to be used to refinance a portion of the company’s secured debt under its existing secured Murabaha and Ijara facilities and repay $200 million drawn under its revolving credit facility. The remaining cash will be kept on the balance sheet to finance future capital spending, according to Moody’s Investors Service.

Credit Suisse, Goldman Sachs, HSBC, Albilad Investment, JPMorgan, Jamco Invest and Warba Bank were bookrunners of the deal, according to a source.

Further information on the Saudi Arabian-based shopping mall company’s sukuk was not available on Thursday.

Pakistan brought a blockbuster, pricing $2.5 billion of notes in three tranches due in five, 10 and 30 years (B3//B-).

All three tranches priced at par on Wednesday.

The $1 billion of notes due April 8, 2026 priced with a 6% coupon for a yield spread of 509.5 bps over Treasuries.

The $1 billion of notes due April 8, 2031 priced with a 7 3/8% coupon for a spread of 565.7 bps over Treasuries.

The $500 million tranche of notes due April 8, 2051 priced with an 8 7/8% coupon and a 648.3 bps spread over Treasuries.

Credit Suisse, Deutsche Bank, Emirates NBD Capital, JPMorgan and Standard Chartered Bank are the joint lead managers and joint bookrunners and BOC International is joint lead manager and passive joint bookrunner of the Rule 144A and Regulation S transaction.

Combined order books were in excess of $5.3 billion at the time the deal was launched.

Elsewhere, issuers from Asia were a significant presence in the market.

AIA Group Ltd. priced $750 million of 2.7% resettable subordinated perpetual securities (A3/A+/A-), according to a notice on Wednesday.

The notes were sold under the company’s recently established $12 billion global medium-term note program.

Demand was over $5 billion from investors for the issue and the proceeds will be used for general corporate purposes.

AIA is a pan-Asian life insurance group based in Hong Kong.

Korea National Oil Corp. launched a $700 million offering of notes in two tranches, according to a market source.

The deal includes $400 million of notes due April 7, 2026 launched at Treasuries plus 52.5 bps. Initial talk for the tranche was in the Treasuries plus 80 bps area.

The issuer also plans to sell $300 million of notes due April 7, 2031, which were launched at Treasuries plus 75 bps. Initial talk had been in the Treasuries plus 100 bps area.

Korea National Oil is an oil and gas production and exploration company based in Ulsan, South Korea.

EM-focused Greenko Dutch BV priced $940 million 3.85% senior notes due 2026, according to a notice.

Greenko is a utility service provider based in Rotterdam, Netherlands. Its parent, Greenko Energy Holdings, is based in Hyderabad, India.

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