Emerging markets: Brazil sells $3.5 billion notes; Hungary, Estonia price €1.5 billion each

By Rebecca Melvin

New York, June 5 – The Federative Republic of Brazil priced $3.5 billion of notes in two tranches this past week as the emerging markets debt market saw some renewed strength following a period of depleted demand in the midst of the Covid-19 pandemic.

The sovereign priced 2 7/8% global bonds due 2025 and 3 7/8% global bonds due 2030 (Ba2/BB-/BB-), according to an FWP filing with the Securities and Exchange Commission.

The $1.25 billion of Brazil’s five-year bonds priced at 99.425 to yield 3%, and the $2.25 billion tranche of 10-year bonds priced at 98.977 to yield 4%.

BofA Securities, Inc., Deutsche Bank Securities Inc., Itau BBA USA Securities, Inc. and J.P. Morgan Securities LLC are joint bookrunners for the SEC-registered bonds.

Proceeds will be used to repay debt, as previously reported.

For the Central & Emerging Europe region, the Republic of Hungary priced an inaugural issue of green notes, bringing €1.5 billion of 1¾% green notes due 2035.

The notes priced at 97.332 for a reoffer yield of 1.957%, or yield spread of mid-swaps plus 190 basis points. Pricing was tight compared to initial talk for the Regulation S deal of mid-swaps plus 240 bps.

Credit Agricole CIB, ING and JPMorgan are the bookrunners.

Meanwhile, the Republic of Estonia came to market for the first time in 18 years, pricing €1.5 billion of 1/8% 10-year notes (AA-) at 98.914 to yield 0.235%, or a yield spread of mid-swaps plus 30 bps, according to a market source.

The pricing for the Estonia deal was guided to yield mid-swaps plus 40 bps to 45 bps after initial talk for a yield of mid-swaps plus 55 bps to 60 bps.

Citigroup, Nordea and Societe Generale were the bookrunners of the Regulation S deal, which is expected to have been €1.25 billion in size.

The books at the time guidance was released had about €9 billion of orders.

Cemex leads corporates

Despite signs of strength, the EM debt market on the corporate side was largely absent. Cemex SAB de CV was the exception, however. The Monterrey, Mexico-based cement company priced $1 billion of 7 3/8% senior secured notes due 2027 (BB/BB-) at par on Tuesday.

The Cemex notes are non-callable until June 5, 2023.

BBVA, Citi, Credit Agricole and JPMorgan were joint bookrunners, leading the transaction, with Bank of America, HSBC, ING and Mizuho also acting as bookrunners, according to a market source.

The proceeds will be used for general corporate purposes, including to repay debt.

Cemex is a cement producer based in Monterrey, Mexico.

From Asia, Korea Development Bank issued $1 billion of 1¼% senior notes due 2025.

BNP Paribas, Kexim Asia Ltd., Credit Suisse Securities (Europe) Ltd., ING Bank NV, Singapore Branch, KDB Asia Ltd., Societe Generale and Standard Chartered Bank were joint lead managers and joint bookrunners of the deal.

The commercial lender is based in Seoul, South Korea.

New deals from China

And elsewhere in the region there were the typical holding company and property development issuers.

Coastal Emerald Ltd., a subsidiary of China Shandong Hi-Speed Financial Group Ltd., which is an investment holding company based in Hong Kong, issued $800 million of 3.8% one-year notes.

Lead managers and bookrunners of the deal were Citigroup Global Markets Ltd., BOCI Asia Ltd., Bank of China Ltd., Standard Chartered Bank, CLSA Ltd., China Citic Bank International Ltd., Industrial and Commercial Bank of China (Asia) Ltd., ICBC International Securities Ltd., ABCI Capital Ltd., China Everbright Securities (HK) Ltd., China Minsheng Banking Corp., Ltd., Hong Kong Branch, CMB Wing Lung Bank Ltd., DBS Bank Ltd., GF Securities (Hong Kong) Brokerage Ltd., Huatai Financial Holdings (Hong Kong) Ltd., Shanghai Pudong Development Bank Co., Ltd., Hong Kong Branch, Soochow Securities International Brokerage Ltd., SPDB International Capital Ltd., Bank of East Asia, Ltd. and Zhongtai International Securities Ltd.

Sands China Ltd., a majority owned subsidiary of Las Vegas Sands Corp., priced $1.5 billion of senior notes (Baa2/BBB-/BBB-) in two tranches, including $800 million of 3.8% senior notes due 2026 and $700 million of 4 3/8% notes due 2030.

The 2026 notes feature a make-whole call until Dec. 8, 2025 and then a par call. Similarly, the 2030 notes have a make-whole call until March 18, 2030 and then a par call.

Barclays, BofA Securities, Inc. and Goldman Sachs & Co. LLC are the initial purchases of the Rule 144A and Regulation S notes.

The company plans to use the proceeds for incremental liquidity and general corporate purposes.

Based in Macau, Sands China is a resort developer and operator in Macau and a subsidiary of Las Vegas Sands.

Shenzhen, China-based holding company Vigorous Champion International Ltd. issued $600 million of 2¾% guaranteed notes due 2025 on Tuesday.

Guotai Junan Securities (Hong Kong) Ltd., Haitong International Securities Co. Ltd., Hongkong and Shanghai Banking Corp. Ltd., Mizuho Securities Asia Ltd. and Standard Chartered Bank are the bookrunners.

The issuer is a British Virgin Islands-based subsidiary of China Ping An Insurance Overseas (Holdings) Ltd., which is a subsidiary of Ping An Insurance (Group) Co. of China, Ltd.

The company specialize in insurance and financial services.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.