Egypt launches €2 billion of notes; Telefonica prices; Lebanon outperforms

By Rebecca Melvin

New York, April 4 – The Arab Republic of Egypt launched €2 billion of new notes on Thursday, which put pressure on the sovereign’s existing bond yield curve.

The two tranches have maturities in 2025 and 2031. The €750 million six-year tranche was launched to yield 4¾%, which was tightened from initial talk in the 5 1/8% area; and the €1.25 billion tranche of 12-year notes was launched to yield 6 3/8%, which was tightened from initial talk for yield in the area of 6 7/8%.

Egypt was in the international bond market last on Feb. 19 when it priced $4 billion of notes due 2024, 2029 and 2049.

Also new to the market was Telefonica del Peru SAA’s newly priced PEN 1.7 billion of 7 3/8% eight-year notes. The rare, global local-currency bond saw high demand of PEN 3.2 billion; but the issue size, which is the equivalent of $515 million, was as expected.

Overall spreads for emerging markets were little changed on the day. In the Middle East and Africa region, a big outperformer was Lebanon. The Middle Eastern country saw spreads come in by as much as 72 bps for its 6.15% notes due 2022, representing a price of 88.83 bid, 89.83 offered, according to a London-based market source.

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