Saudi Arabia prices $9 billion deal; 4finance sells notes; Turkey stable ahead of vote

By Colin Hanner

Chicago, April 13 – The last day of an Easter-shortened week for most of the world ended with the last of new deals being pushed through in emerging markets.

“As we head into the Easter weekend in many countries, market activity has remained high thanks to decent issuance volumes in [emerging markets],” a market source said.

The most notable was Saudi Arabia’s pricing of $9 billion of notes due 2022 and 2027 on Wednesday, a market source said.

The issuer priced $4.5 billion 2.894% five-year notes at par to yield 2.9149%.

A $4.5 billion tranche of 3.628% 10-year notes was priced at par to yield 3.6609%.

The five-year notes’ initial spread guidance started at 115 basis points and the 10-year deal at 155 bps, a market source said.

On Wednesday morning, a market source said both of those deals tightened, and by Wednesday afternoon, initial spread guidance was 100 bps for the five-year notes and 140 bps for the 10-year notes.

The deal was issued through KSA Sukuk Ltd.

Citibank, HSBC, JPMorgan, BNP Paribas, Deutsche Bank and NCB Capital were bookrunners for the deal.

“Yesterday, Saudi Arabia completed its debut dollar sukuk transaction, raising a total of [$9 billion] from markets ... the new sukuks are neither shy in being the largest dollar sukuks outstanding,” a market source said.

Saudi sovereigns inch higher

Saudi Arabia sovereigns were little changed again during Thursday’s session, a market source said.

The 2 3/8% notes due 2021 were quoted with a 98.19 bid, 98.28 offer, about a 1/5 point higher on the day.

And its 3¼% notes due 2026 were more than a 1/10 point higher, quoted with a 97.37 bid, 97.57 offer.

4finance sells five-year notes

Latvia’s 4finance Holding SA priced $325 million of five-year senior notes at par to yield 10¾% on Thursday, the company said in a news release.

Stifel Nicolaus Europe Ltd. was the bookrunner for the Rule 144A and Regulation S deal.

Proceeds from the new issue will be put toward refinancing 4finance’s dollar-denominated notes due 2019, to call its Swedish krona-denominated notes due 2018 and for general corporate purposes.

4finance is an online and mobile consumer lending group.

Power vote looms in Turkey

A “yes” or “no” vote will take place in Turkey over the weekend, as voters will decide to whether to shift more power to President Recep Tayyip Erdogan. Yet, with potential instability and uncertainty coming out of a vote on either side, the country’s bonds have not gone through the shock many expected.

“Turkey credit has remained remarkably resilient over the last few weeks, with sovereign cash trading [10 bps] wider on spread over the week, which is in line with other similar-rated EM sovereigns, and also offset by the tightening in U.S. Treasuries,” a market source said.

PDVSA higher after payment

A day following Petroleos de Venezuela SA’s follow-through on a $2.1 billion payment to investors on short-term maturities, notes were ticking higher yet again.

On Thursday, the 8½% notes were up 2½ points to an 88½ bid, 89½ offer, a market source said.

And the 9% notes due 2021 were up 1½ points to 54 bid, 55 offered.

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