Bahrain, Panama, Turkey tap global markets; SK Hynix, SJM and Sunac issue new notes

Chicago, Jan. 22 – As usual, the bulk of emerging markets issuance came from Asia, specifically China.

However, there were interesting outliers from other parts of the world.

Particularly, the Kingdom of Bahrain priced $2 billion of notes, and the Republic of Panama reopened their global bonds for $2.45 billion and the Republic of Turkey priced $3.5 billion from two tranches.

Notable issuers from Asia included South Korea’s SK Hynix Inc., SJM Holdings Ltd., and Sunac China Holdings Ltd.

Bahrain

Bahrain sold $2 billion of senior notes in three tranches due in seven, 12 and 30 years, according to a notice.

The non-investment grade issuing country has been running a deficit for many years with 2020 only running a higher deficit, according to the fiscal balance program from the Ministry of Finance and National Economy.

The sovereign issuer sold a seven-year $500 million tranche, a 12-year $1 billion part and a 30-year $500 million issue.

Panama

Panama reopened its global bond program to price a two-part transaction that included $1.25 billion of 2.252% bonds due 2032 and $1.2 billion of 3.87% global bonds due 2060.

The 2032 bonds priced at 100.543, and the 2060 notes were sold at 110.391.

Both parts are fungible with earlier offerings.

In November, the republic modified a law on fiscal social responsibility for the nation, resulting in approved fiscal deficits of between 9% and 10.5% of GDP in 2020, between 7% and 7.5% in 2021, 4% in 2022, 3% in 2023, 2% in 2024 and 1.5% in 2025 and subsequent years, according to a 424B5 filing with the Securities and Exchange Commission.

Turkey

Turkey’s sizeable SEC-registered issue was in demand with investor interest reaching more than $15 billion for the two equal-sized tranches for the $3.5 billion issue.

Citigroup Global Markets Inc., Goldman Sachs International, and J.P. Morgan Securities plc led the issue, which involved more than 300 different investors.

The breakout of subscriber demand was 36% from the United States, 32% from the United Kingdom, 18% from other parts of Europe, 10% from Turkey itself and 4% from other countries.

According to Turkey’s Ministry of Treasury and Finance, it was the highest investor demand for issuance from the republic.

The two tranches broke down into a 2026 part that priced to yield 4.9% from a 4¾% coupon and a June 2031 tranche which priced with a yield of 5.9% from a 5 7/8% coupon.

Turkey was in the global markets as recently as the end of November with a $2.25 billion single tranche of 10-year notes that yielded 6%.

SK Hynix

Settling this week was a three-part transaction from South Korea’s semiconductor supplier SK Hynix.

Of note in the transaction was a $1 billion green tranche which priced on Jan. 14.

The one tranche was upsized from $500 million with participation in the order books from 230 global institutions, according to the company.

The proceeds, according to the group will be used “to prioritize the establishment of a new state-of-the-art wastewater disposal plant and a water recycling system as water management is extremely critical in semiconductor industry. Also, the company will proceed with various projects including the development of low-power solid state drives (SSDs), in order to reduce carbon emission throughout the IT ecosystem in general.”

All three tranches totaled $2.5 billion.

SJM Holdings

Macau-based SJM, operator of six casinos, brought a $1 billion two-part offering to emerging markets investors during the week.

The company sold $500 million of notes due 2026 and a seven-year offering, also for $500 million.

The two tranches will be used primarily for refinancing the company’s syndicated credit facilities.

Both tranches were sold at par with the 2026 notes coming with a 4.5% coupon and the 2028 notes carrying a 4.85% coupon.

Sunac China

Sunac China sold $1.1 billion of new notes in two parts, $600 million for the first tranche due 2024 and $500 million for the slightly longer dated part due 2026.

At nearly the same time as announcing the new issue, Sunac issued a redemption notice for the company’s 7 7/8% senior notes due 2022.

The Tianjin, China-based residential and commercial property developer has all of the proceeds earmarked for debt repayment.

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