QNB, COLI, Latin American Airports, Russian Standard do deals; trading 'choppy' but active

By Christine Van Dusen

Atlanta, Nov. 7 - Qatar National Bank SAQ (QNB), China Overseas Land & Investment (COLI), Dominican Republic-based Latin American Airports Holdings and JSC Russian Standard Bank sold notes on a choppy but fairly active post-election Wednesday for emerging markets investors.

The primary market also saw Brazil's Itau Unibanco Holding SA upsize its recent dollar deal.

Issuance lies ahead for several other names, including China-based Melco Crown Entertainment subsidiary Studio City, China's Baidu Inc., emerging markets-focused Credit Europe Bank NV, Singapore-based Global A&T Electronics Ltd., Abu Dhabi Islamic Bank and the Slovak Republic.

"The news that Barack Obama has won a second term as President of the United States has prompted a rally in US Treasuries but little response in other markets," according to a report from Barclays.

In trading, investors showed some interest in Qatar's 2018 sukuk at the 110 level, a London-based trader said.

The recent Qatar International Islamic Bank issue of 2.688% notes due 2017 that priced at par on Oct. 11 was seen Wednesday at 100 1/8 on the bid side.

"The long end still feels well supported," he said, pointing to RasGas and International Petroleum Investment Co. bonds.

From Africa, bonds from Nigeria got a boost after a ratings upgrade to BB- by Standard & Poor's and to Ba3 from Moody's Investors Service.

Moody's also assigned Zambia a B1 rating. In response the sovereign's bond traded at 100.5625 bid, 101.0625 offered.

"Bond feels stuck here," a trader said. "That's 8 basis points wider on the month."

Meanwhile, paper was around for names like Angola and Senegal, he said.

QNB sells notes

In its new deal, Qatar National Bank sold $1 billion 2 1/8% notes due Feb. 14, 2018 at 99.293 to yield mid-swaps plus 145 bps, a market source said.

Deutsche Bank, HSBC, Mitsubishi UFJ Securities, QNB Capital and Standard Chartered were the bookrunners for the Regulation S-only deal.

The notes went on to trade at 99.20 bid, 99.40 offered, then moved to 99.15 bid, 99.30 offered. Later in the session the notes were sighted at 99.20 bid, 99.35 offered.

"The range I traded on the new one was 99.10 to 99.30," a trader said. "The broader markets changed a fair bit between the deal announcement and now, but we close wrapped around re-offer."

COLI prices bonds

Wednesday also saw Hong Kong's COLI price a two-tranche issue of $1 billion notes due on Nov. 15 of 2022 and 2042 in a Regulation S deal via BOCI, Citigroup, BNP Paribas, Goldman Sachs and UBS.

The construction and development company's transaction included $700 million 3.95% notes due in 2022 that priced at 99.665 to yield Treasuries plus 235 bps. The tranche was talked at Treasuries plus 235 bps to 240 bps.

The second tranche, $300 million 5.35% notes due in 2042, came to the market at 99.792 to yield Treasuries plus 255 bps. The notes were talked at Treasuries plus 255 bps to 260 bps.

More new deals

Latin American Airports Holdings priced a $500 million issue of 9¼% notes due Nov. 13, 2019 at par to yield 9¼%, a market source said.

JPMorgan was the bookrunner for the Rule 144A and Regulation S notes.

And Moscow-based retail lender Russian Standard Bank printed a $175 million add-on to its 9¼% notes due July 11, 2017 at 102.25 to yield 8.647%.

The notes priced wider than talk, set at 101.5 to 102.

Citigroup and JPMorgan were the bookrunners for the Regulation S deal.

The original $350 million issue priced in July at par to yield 9¼%.

Itau Unibanco prints notes

In another new deal, Itau Unibanco upsized its $1.7 billion 5 1/8% notes due May 13, 2023 by $170 million, pricing the notes at par, according to a company announcement.

BB Securities, Itau Unibanco, JPMorgan and Santander were the bookrunners for the Rule 144A and Regulation S deal.

The original issue totaled $1.7 billion and priced at par to yield Treasuries plus 343 bps.

Proceeds will be used for general corporate purposes.

Middle East in focus

On the trading front, Dubai Electricity and Water Authority's 2020s were quoted Wednesday at 119.37, 25 bps tighter on the month.

Bahrain's 2020s were 10 bps wider and its 2022s 15 bps wider on the week.

"Still feels like there are some buyers of some higher-yielding names," a trader said.

First Gulf Bank PJSC's 2017s moved to 101 on the bid side after pricing at par.

Spread unchanged for Sasol

From South Africa, the new $1 billion issue of 4½% notes due 2022 from Sasol Financing International plc saw a high print of 100.40.

The Johannesburg-based energy, mining and chemical company priced the notes at 99.048 to yield Treasuries plus 287.5 bps via Barclays, HSBC and JPMorgan.

"It's closing at 99.90 on the bid side, which is unchanged, spread-wise," a trader said. "Solid effort."

Some buyers were seen for Investec Ltd., and Eskom Holding's bonds were sighted at 113.

And South Africa saw its five-year credit default swaps close on Wednesday at 151 bid, 156 offered, he said.

Ukraine bonds move up

Bonds from Ukraine have been trading well, with buyers pushing the sovereign's 2020s above 1051/2, said Svitlana Rusakova of Dragon Capital.

"The 2021s could have performed as well but it seemed nobody had anything to offer," she said.

Ukraine's 2017s were not so strong, however, moving from 110 to 1091/4.

Corporate issues were under some pressure, after the Ukraine parliament authorized the National Bank of Ukraine to require exporters to sell their hard currency earnings to the central bank, she said.

Melco to price dollar notes

In deal-related news, Melco Crown Entertainment subsidiary Studio City is planning an eight-year issue of $825 million notes, a market source said.

Deutsche Bank, ANZ, Bank of America Merrill Lynch, Citigroup, Credit Agricole and UBS are the bookrunners for the Rule 144A and Regulation S deal.

The notes include a change-of-control put at 101 and are non-callable for three years.

Melco is a Hong Kong-based developer and owner of casino gaming and entertainment resort facilities focused on the Macau market.

Baidu on roadshow

Chinese internet search provider Baidu is on a roadshow for its dollar-denominated issue of senior notes, a market source said.

JPMorgan and Goldman Sachs are the bookrunners for the Securities and Exchange Commission-registered deal.

The roadshow began on Wednesday in Hong Kong and travels on Thursday to Singapore, then wraps up on Nov. 12 in London.

Proceeds will be used to retire $350 million of credit facility debt and for general corporate purposes.

ANZ, Bank of China and Deutsche Bank will be co-managers.

More upcoming issues

Netherlands-based Credit Europe Bank - a lender that serves emerging Europe, China and the United Arab Emirates - is planning a $200 million-minimum issue of seven-year notes (Ba3/BB-/), a market source said.

The Regulation S-only notes are expected to price this week via bookrunners Goldman Sachs and Morgan Stanley.

And Singapore-based semiconductor company Global A&T Electronics has scheduled a roadshow from Thursday until Nov. 19 for a six-year issue of $625 million notes, a market source said.

Bank of America Merrill Lynch, Credit Suisse, JPMorgan and UBS are the bookrunners for the Rule 144A and Regulation S transaction.

Proceeds from the offering will be used to prepay debt.

ADIB gives initial guidance

Abu Dhabi Islamic Bank set initial price talk at the 7% area for a planned dollar-denominated issue of perpetual notes, a market source said.

Abu Dhabi Islamic Bank, HSBC, Morgan Stanley, National Bank of Abu Dhabi and Standard Chartered Bank are the bookrunners for the Regulation S-only sukuk.

As of Wednesday, the books were in excess of $4 billion, the source said.

And the Slovak Republic set the spread at mid-swaps plus 150 bps for its planned issue of benchmark-sized euro notes due in 2024.

Societe Generale, Erste Group and Unicredit are the bookrunners for the Regulation S deal, which is expected to price this week.

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