KCSM, Alliance Oil, Rwanda, Sinochem among issuers from EM; corporate spreads tighten

By Christine Van Dusen

Atlanta, April 25 - Kansas City Southern de Mexico (KCSM), Russia's Alliance Oil Co. Ltd., the Republic of Rwanda, China's Xinyuan Real Estate Co. Ltd., Singapore's Raffles Education Corp. Ltd., India's Tata Steel Ltd. and China's Sinochem Group sold notes on Thursday.

"In trading [Central Europe] and emerging Europe are generally seeing a slightly better bid," a London-based analyst said. "Middle East and North Africa are again seeing a steady start. Some nibbling on perpetuals again."

The Markit iTraxx SovX CEEME ex-EU index was unchanged on Thursday at Treasuries plus 190 basis points. The corporate index - which was seen Wednesday at 240 bps over Treasuries - tightened by 5 bps.

"Buyers are around again on Abu Dhabi Commercial Bank's 2018s and 2023s," she said. "Abu Dhabi and Qatar are solidly supported again."

Also on Thursday, several issuers planned roadshows or issued price talk. On that list were Indonesia's Trikomsel Pte. Ltd., Colombia's Avianca Holding SA, Turkey's Turkiye Sise ve Cam Fabrikalari AS (Sisecam), Korea Resources Corp. and Russia's OJSC MMC Norilsk Nickel. Additional deals were on deck, including notes from Russia's Credit Bank of Moscow, China's Citic Securities Co. Ltd., Malaysia's Parkson Retail Group Ltd., Turkey's Albaraka Turk Katilim Bankasi AS, Chile's SACI Falabella and Nigeria's Fidelity Bank plc.

In its new deal, KCSM priced a $725 million issue of two-tranche notes due 2020 and 2023, while Kansas City Southern Railway Co. printed $450 million notes due 2043 via BofA Merrill Lynch, JPMorgan and Morgan Stanley, a market source said.

KCSM does three tranches

KCSM's deal included $275 million 2.35% notes due 2020 that priced at 99.884 to yield 2.368%, or Treasuries plus 125 bps. The second tranche of $450 million 3% notes due 2023 priced at 99.587 to yield 3.048%, or Treasuries plus 135 bps.

The third tranche, $450 million 4.3% notes due 2043, came to the market via Kansas City Southern Railway and priced at 99.081 to yield 4.355%, or Treasuries plus 145 bps.

Alliance Oil, Rwanda notes

Thursday also saw Russia-based Alliance Oil price a $500 million issue of 7% notes due 2020 at 99.32 to yield 7 1/8% after talk in the 7 ¼% area.

Deutsche Bank, Gazprombank, Goldman Sachs and Raiffeisen Bank were the bookrunners for the Rule 144A and Regulation S deal.

And Rwanda has priced a $400 million issue of 6 5/8% notes due 2023 at 98.213 to yield 6 7/8%, or mid-swaps plus 498.7 bps, a market source said.

BNP Paribas and Citigroup were the bookrunners for the Rule 144A and Regulation S deal.

Xinyuan Real Estate bonds

China-based real estate company Xinyuan Real Estate priced $200 million 13¼% notes due 2018 at par to yield 13¼% via Barclays, Morgan Stanley and BofA Merrill Lynch in a Regulation S deal.

And Singapore-based private education group Raffles Education sold S$50 million 5.9% notes due 2018 at par to yield 5.9% with HSBC and UOB.

New deal from Tata Steel

India's Tata Steel, through wholly owned subsidiary Abja Investment Co. Pte. Ltd., priced S$300 million 4.95% notes due 2023 at par to yield 4.95%, a market source said.

The notes priced in line with talk, set at 4.95%.

Nomura Securities, RBS, SBI and Standard Chartered Bank were the bookrunners for the Regulation S deal.

Sinochem prices notes

China-based conglomerate Sinochem priced $600 million 5% perpetual notes at par to yield 5%, a market source said.

The notes matched talk, set at 5%.

Citigroup, UBS, Goldman Sachs, Morgan Stanley and HSBC were the bookrunners for the Rule 144A and Regulation S deal.

These new deals followed the Wednesday pricing of Korea Development Bank's A$100 million issue of 4½% notes due April 30, 2018 at 100.995, a market source said.

ANZ was the bookrunner for the transaction.

Trikomsel on roadshow

Indonesia's Trikomsel is on a roadshow with ANZ, JPMorgan and Standard Chartered Bank for a Singapore dollar-denominated issue of notes, a market source said.

The marketing trip began on Thursday and will take place in Singapore.

A Regulation S deal is expected to follow.

The issuer is a wholly owned subsidiary of PT Trikomsel Oke Tbk, a mobile phone operator based in Jakarta, Indonesia.

Avianca mandates bookrunners

Colombia-based airline holding company Avianca Holding has mandated Citigroup and JPMorgan to arrange a roadshow for a dollar-denominated issue of notes.

The marketing trip will begin on Friday. A Rule 144A and Regulation S deal is expected to follow.

And Turkey-based industrial group Sisecam is planning a roadshow for an issue of up to $500 million of notes, a market source said.

Korea Resources sets talk

Korea Resources set talk in the Treasuries plus 145 bps to 150 bps range for its upcoming dollar-denominated issue of benchmark-sized notes due in five years, a market source said.

Citigroup, Deutsche Bank, HSBC, Korea Development Bank and Standard Chartered Bank are the bookrunners for the Rule 144A and Regulation S deal.

And Russia's Norilsk Nickel set price talk in the 4 3/8% area for a dollar-denominated issue of five-year notes with Barclays, Citigroup and Societe Generale in a Regulation S deal.

Moscow bank gives guidance

Russia's Credit Bank of Moscow set talk in the 8¾% area for its planned issue of dollar-denominated notes due in 5½ years with HSBC, RBI and RBS in a Rule 144A and Regulation S deal.

The proceeds will be used for general corporate purposes.

And China-based investment bank Citic Securities set final talk in the Treasuries plus 190 bps area for its upcoming issue of dollar-denominated notes due in five years, a market source said.

Citic, Bank of China, HSBC, Standard Chartered, BofA Merrill Lynch, Deutsche Bank, Credit Agricole, JPMorgan, Barclays and ABC International are the bookrunners for the Regulation S deal.

Parkson, Albaraka set talk

Malaysia-based Parkson Retail set price talk in the 4½% to 4 5/8% range for its five-year issue of $500 million notes, a market source said.

DBS Bank, JPMorgan and Nomura Securities are the bookrunners for the Regulation S deal.

And Turkey's Albaraka Turk AS set initial talk in the 8% area for its upcoming issue of dollar-denominated Islamic bonds.

BNP Paribas, Al Hilal Bank, Barwa Bank, Emirates NBD Capital and Nomura Securities are the bookrunners for the Regulation S-only sukuk offering.

A roadshow began on April 18 in Zurich and then traveled to London, Abu Dhabi, Dubai and Doha before concluding on April 23 in Manama, Bahrain.

Falabella guidance released

Chile-based retail company Falabella set price talk in the Treasuries plus low- to mid-200 bps area for a dollar-denominated issue of notes, a market source said.

Citigroup, HSBC and Itau BBA are the bookrunners for the Rule 144A and Regulation S deal.

And Nigeria's Fidelity Bank has mandated Citigroup and Deutsche Bank to arrange a roadshow starting Friday.

A dollar-denominated issue of Rule 144A and Regulation S notes is expected to follow.

CAG oversubscribed

The final book for Brazil-based engineering and construction company Construtora Andrade Gutierrez SA's (CAG) 500 million issue of 4% notes due 2018 was about $2.5 billion, a market source said.

The notes priced at 99.44 to yield 4 1/8%, or Treasuries plus 343 bps, after talk in the 4¼% area.

About 60% of the orders came from the United States, 23% from Europe, 17% from Latin America and 1% from Asia.

Asset managers accounted for 58%, private banks 14%, pension and insurance 12%, banks 10% and hedge funds 5%.

BTG Pactual, JPMorgan and Espirito Santo were the bookrunners for the Rule 144A and Regulation S transaction

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