Deals from Senegal, Otto Marine; Russia remain in focus; Middle Eastern bonds get support

By Christine Van Dusen

Atlanta, July 23 –Senegal and Singapore’s Otto Marine Ltd. sold notes on Wednesday amid concern that the European Union could institute further sanctions on Russia.

“The European Union held a meeting last night but will not make any decisions on sanctions until Thursday,” a London-based analyst said. “Nonetheless, we have heard politicians speak of restricting capital market access and targeting the financial and energy sectors.”

New sanctions aren’t expected to be sizable, though, she said.

“Russia is opening relatively firm this morning, with two-way action and bonds generally a little tighter,” she said.

Bonds from the Middle East saw some support in the secondary market on Wednesday, with traders struggling to find paper from such names as Saudi Electricity Co. and Abu Dhabi National Energy Co., a London-based trader said.

Demand was also seen for 10-year paper from Dubai’s Emaar Malls Group, he said.

“The Abu Dhabi, Qatar and Saudi Arabia complex is all supported,” he said, adding the market was “finally seeing some interest in the Kuwaiti complex, with Kuwait Projects Co.’s 2020s off the lows.”

Burgan Bank also saw some demand, he said.

“Bahrain was heavy late yesterday on further rumors of supply, though there’s nothing official that I’ve seen,” he said. “Bahrain has had a tough run lately.”

Perpetual bonds from the region were popular again, he said.

“Moderately active, given the time of year,” he said.

In deal-related news, China’s Sino-Ocean Land Holdings Ltd., India’s Greenko Group plc and India’s Tata Steel Ltd. set guidance for upcoming offerings of notes.

LatAm tightens

Looking to Latin America, spreads moved tighter again on Wednesday, and buyers outpaced sellers, a New York-based trader said.

Brazil’s high-grade names saw better bids while the high-yielders were firm but quiet.

Peru bonds were also quiet on Wednesday, though a little bit stronger, he said.

Credits from Mexico that recently demonstrated some weakness were able to make some small gains on Wednesday.

Brazil to sell notes

Brazil on Wednesday was set to price a minimum of $1 billion of notes due January 2045, a syndicate source said.

The notes had not priced as of the market’s close but were expected to price later in the evening.

The notes were talked at a spread in the 200 bps area.

BofA Merrill Lynch, Deutsche Bank and Itau BBA are the bookrunners for the Securities and Exchange Commission-registered deal.

The proceeds will be used for liability management and general government purposes.

The sovereign has also launched a tender offer.

Senegal prints bonds

Senegal sold $500 million 10-year notes (B1/B+/) at par to yield 6Ľ%, a market source said.

The notes were talked at a yield in the 6˝% area.

Citigroup, Societe Generale CIB and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

Issuance from Otto Marine

Singapore’s Otto Marine sold S$70 million two-year notes at par to yield 7%, a market source said.

BNP Paribas, DBS Bank and Oversea-Chinese Banking Corp. Ltd. were the bookrunners for the deal.

Based in Singapore, Otto Marine constructs, charters and leases vessels.

Sino-Ocean sets talk

China’s Sino-Ocean Land – through Sino-Ocean Land Treasure Finance I Ltd. – set talk for a two-tranche issue of dollar-denominated and benchmark-sized notes due in five and 10 years, a market source said.

The notes due in five years were talked at a spread in the Treasuries plus 315 bps area.

The notes due in 10 years were talked at a yield of 6.15%.

Bank of China (Hong Kong), Deutsche Bank, Goldman Sachs, HSBC and JPMorgan are the joint global coordinators. ANZ, DBS, Morgan Stanley and UBS are the bookrunners for the Regulation S issue.

The proceeds will be used for repaying existing debt and for general corporate purposes, according to a company filing.

The issuer is a Beijing-based real estate developer.

Greenko gives guidance

India-based clean energy facilities operator Greenko Group set talk in the 8Ľ% area for a dollar-denominated offering of benchmark-sized notes due in five years, a market source said.

Deutsche Bank, Barclays, Investec, JPMorgan and Standard Chartered Bank are the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will primarily be used to refinance certain debt and repay loans, as well as for general corporate purposes.

Talk from Tata

India-based Tata Steel set talk for a two-tranche offering of dollar-denominated and benchmark-sized notes due in 5˝ and 10 years, a market source said.

The 5˝-year notes were talked at a yield in the low-to-mid-5% area.

The 10-year notes were talked at a yield in the mid-6% area.

ANZ, BofA Merrill Lynch, BNP Paribas, Citigroup, Credit Agricole CIB, Deutsche Bank, HSBC, Morgan Stanley, Rabobank International, RBS, SBI Capital Markets and Standard Chartered Bank are the bookrunners for the Regulation S deal.

The proceeds will be used for paying debt and for general corporate purposes.

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