Saudi Electricity and Shangri-La price deals; Bladex launches upsized $400 million issue

By Aleesia Forni

Columbus, Ohio, March 28 - Emerging markets saw Saudi Electricity Co. (A1/AA-/AA-) price $1.75 billion of sukuk in two tranches on Wednesday, according to market sources.

"While the deal has rarity, the shockingly poor distribution of this deal is capping the performance in the short term," a London-based source said.

The $500 million of 2.665% five-year sukuk priced at par to yield mid-swaps plus 140 basis points, and the $1.25 billion tranche of 4.211% 10-year paper sold at par to yield mid-swaps plus 195 bps.

HSBC and Deutsche Bank were bookrunners for the deal.

The source added that the bonds saw 55 enquiries early in the London session, but only five had been buyers.

The bonds were up 1 point by late Wednesday.

The Markit iTraxx SovX CEEMEA index of Central and Eastern European, Middle East and African credit-default swaps was "basically unchanged" on the day, settling at 265 bps, reflecting the relative lack of interest in the space apart from new issues.

Also in the primary market, Shangri-La Asia Ltd. priced $600 million of senior notes, and Banco Latinoamericano de Comercio Exterior SA (Bladex) launched a $400 million issue.

Shangri-La senior notes

Shangri-La priced a $600 million 4¾% issue of senior notes due 2017 at 99.938 to yield 4.764%, according to market sources.

HSBC, Morgan Stanley, Bank of China and Credit Agricole managed the Regulation S deal.

Hong Kong-based Shangri-La engages in the ownership and operation of hotels and resorts.

Bladex upsized deal

On Wednesday Bladex (Baa2/BBB/BBB) launched an upsized $400 million issue of five-year senior notes (BBB/BBB) at Treasuries plus 287.5 bps, according to a market source.

Initial guidance was set in the area of Treasuries plus 312.5 bps for a $250 million issue of notes.

Proceeds will be used for general corporate purposes.

Credit Suisse and Bank of America Merrill Lynch are the joint bookrunners for the Panama City-based bank's Regulation S deal.

Vale add-on

Vale Overseas Ltd. priced a $1.25 billion add-on to its 4 3/8% notes due 2022, according to a company news release. The notes priced at 101.345 to yield 4.205%.

The company originally issued $1 billion of the notes due Jan. 11, 2022 in January at 98.804 to yield 4.525%, or Treasuries plus 255 bps, via bookrunners Citigroup, HSBC, JPMorgan, BB Securities and Bradesco BBI. The notes were registered with the Securities and Exchange Commission.

The notes have a make-whole call.

Proceeds will be used for general corporate purposes.

The notes will be guaranteed by parent company Vale SA, a Rio de Janeiro-based mining and logistics corporation.

Zoomlion senior bonds

Zoomlion HK SPV Co. Ltd. also plans to head to market, setting guidance for its proposed dollar-denominated five-year fixed-rate senior bonds (BB+/BBB-) with a yield of 7% to 7¼%, according to a market source.

BOCI Asia, Credit Suisse Securities (Europe) and Goldman Sachs (Asia) are the joint bookrunners for the Rule 144A and Regulation S deal.

Zoomlion plans to use the proceeds from the offering to fund its overseas expansion plan, which includes enhancing the group's distribution and service network and establishing research and development centers and manufacturing facilities.

Zoomlion manufactures construction machinery and sanitation equipment and is based in Changsha, China.

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