Issues from Nigeria, Ezdan; Brexit, South Africa, Halkbank in focus; Gazprom advances deal

By Christine Van Dusen

Atlanta, March 29 – Nigeria and Qatar’s Ezdan Holding Group sold notes on Wednesday as the United Kingdom began its exit from the European Union.

“The event is unlikely to have any meaningful market impact as long as the negotiation partners don’t dive further into details,” a London-based analyst said.

But other political risks continue for some emerging markets.

“Following recent concerns that South Africa’s President Zuma might just be about to reshuffle the cabinet and dismiss the finance minister, the arrest of [Turkiye Halk Bankasi AS (Halkbank)] deputy chief executive officer Mehmet Hakan Attila in the United States has spooked markets,” he said. “With regard to South Africa, evidence seems to be mounting that President Zuma remains determined to dismiss Finance Minister Gordhan in an upcoming cabinet reshuffle, although it remains unclear whether he would go ahead.”

Regardless of the outcome, the conflict “will certainly weigh on South African risk, no matter the outcome,” he said.

Looking to Halkbank, the company official was detained in the United States on Tuesday while meeting with investors about the Iran sanctions probe.

“The arrest is undeniably highly contentious, given that Halkbank is a majority state-owned bank,” the analyst said.

In response, Halkbank’s bonds traded as much as 60 basis points wider, and the company’s planned issue dollar-denominated and benchmark-sized notes due in 10 years – led by BofA Merrill Lynch – was expected to be postponed.

Investors were also keeping an eye on Credit Bank of Moscow, which was expected to price a 10½-year issue of loan-participation notes via Citigroup, Credit Suisse, HSBC, JPMorgan, Raiffeisen Bank International, Regions Securities and Societe Generale CIB.

Nigeria prices tap

In its new deal, Nigeria priced a $500 million tap of its 7 7/8% notes due in February 2032 at a yield of 7 7/8%, a market source said.

The notes were talked at 7.6% to 7.7%.

Citigroup and Standard Chartered were the bookrunners for the Rule 144A and Regulation S deal.

The original $1 billion issue priced on Feb. 9 at par.

Ezdan issues notes

Also on Wednesday, Qatar’s Ezdan priced $500 million notes due Dec. 31, 2022 at a yield of 4 7/8%, a market source said.

Dubai Islamic Bank, Emirates NBD, HSBC, Mashreqbank, Natixis and Standard Chartered Bank were the bookrunners for the deal.

Other details were not immediately available on Wednesday.

The issuer is a real estate developer.

Gazprom launches LPNs

Russia’s Gazprom OJSC – via Gaz Capital SA – launched a £850 million issue of loan-participation notes due in seven years at a yield of 4¼%, a market source said.

JPMorgan, Deutsche Bank, Gazprombank and VTB Capital are the bookrunners for the Regulation S deal.

Gazprom is a Moscow-based natural gas producer.

Guidance from Al Ahli Bank

Al Ahli Bank of Kuwait set initial talk in the mid-swaps plus 175 bps area for its upcoming issue of dollar-denominated and benchmark-sized notes due in five years, a market source said.

Citigroup, HSBC and National Bank of Abu Dhabi are the bookrunners for the deal.

Saudi Arabia trades

From the Middle East, the three-tranche issue of notes due in 2021, 2026 and 2046 from Saudi Arabia saw some activity on Wednesday.

The 2 3/8% notes due in 2021 that priced at 99.007 to yield 2.588%, or Treasuries plus 135 bps, were seen at 98.18 bid, 98.43 offered after Tuesday’s 98¼ bid, 98.37 offered.

The 3¼%%notes due in 2026 that priced at 98.679 to yield 3.407%, or Treasuries plus 165 bps, were at 97.18 bid, 97.43 offered after Tuesday’s 97¼ bid, 97.37 offered.

And the 4½% notes due in 2046 that priced at 98.015 to yield 4.623%, or Treasuries plus 210 bps, were seen Wednesday at 98.38 bid, 98.63 offered after Tuesday’s 98.31 bid, 98.61 offered.

Citigroup, HSBC, JPMorgan, Bank of China, BNP Paribas, Deutsche Bank, Goldman Sachs, MUFG Securities, Morgan Stanley and NCB Capital were the bookrunners for the Rule 144A and Regulation S deal.

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