Primary hosts Abu Dhabi, Sigma Alimentos, BankMuscat, China Petroleum, Ziraat; slow buying

By Christine Van Dusen

Atlanta, April 25 – Abu Dhabi, Mexico’s Sigma Alimentos SA de CV, Oman’s BankMuscat, China Petroleum & Chemical Corp. (Sinopec) and Turkey-based Turkiye Cumhuriyeti Ziraat Bankasy AS (Ziraat Bank) printed notes on Monday ahead of this week’s meetings of the Federal Reserve and Bank of Japan.

“Huge book on Abu Dhabi the highlight of the day,” a trader said. “The issuer has very good technical and scarcity value, having not issued in seven years and being zero risk-weighted for local banks.

Though there is clearly a “new paradigm for oil credits,” he said, “this deal shows the market is still alive and still finding clearing levels.”

In trading, flows from the Middle East focused mostly on Abu Dhabi names and perpetual bonds, a trader said.

“Further chatter of a few more issuers readying deals,” he said. “Rates near 1.90%, a reasonably well-bid market and five to six weeks before Ramadan presents a pretty solid window for supply.”

These next several weeks “should be better from a flow-trading point of view as the new issues will act like grease and oil to reinvigorate the market and curves and get more switches going,” he said. “And there will obviously be differing opinions on what is value and what is not value, which – for a flow trader – is what is needed, rather than everyone doing the same thing at the same time.”

Lat-Am mostly unchanged

Looking to Latin America, inquiries and volumes were low on Monday morning, with prices hovering near Friday’s close, a New York-based trader said.

“And remember, we weakened into that close on some credits, those that had been pushing higher almost daily over the last two weeks,” he said. “Client buying continues to slow, and the undertones no longer feel as strong as a few weeks back, but the resilience the past few sessions has been impressive.”

Mexico-based Cemex SAB de CV was a standout, he said, with its curve trading stronger and buyers continuing to emerge.

Mexichem deals with aftermath

Meanwhile, Mexico’s Mexichem SAB de CV continued to grapple with the repercussions of last week’s deadly explosion at one of its petrochemical plants, a trader said.

“Mexichem is still trying to deal with the explosion aftermath, added fatalities and costs to capital going forward,” he said. “The curve has not moved any lower since the headline was digested.”

New issue from Abu Dhabi

In its new deal, Abu Dhabi priced a $5 billion issue of notes in two tranches due May 3, 2021 and 2026, a market source said.

The $2.5 billion 2 1/8% notes due in five years priced at 99.562 to yield Treasuries plus 85 basis points, following talk in the 110 bps area.

The $2.5 billion 3 1/8% notes due in 10 years priced at 99.753 to yield Treasuries plus 125 bps, following talk in the 150 bps area.

BofA Merrill Lynch, Citigroup and JPMorgan were the bookrunners for the Rule 144A and Regulation S deal.

Sinopec does deal

Sinopec priced a $3 billion issue of notes in four tranches due in three, five, 10 and 30 years, a market source said.

The $1 billion 2 1/8% notes due May 3, 2019 priced at 99.752 to yield Treasuries plus 120 bps, following talk in the 215 bps area.

The $900 million 2¾% notes due May 3, 2021 priced at 99.815 to yield Treasuries plus 142.5 bps, following talk in the 145 bps area.

The $700 million 3½% notes due May 3, 2026 priced at 99.166 to yield Treasuries plus 170 bps, following talk in the 175 bps area.

And the $400 million 4¼% notes due May 3, 2046 priced at par to yield 4¼%, after talk of 4¼%.

Citigroup, Goldman Sachs, Bank of China, HSBC and JPMorgan were the joint global coordinators for the Rule 144A and Regulation S deal.

The notes were issued via Sinopec Group Overseas Development (2016) Ltd.

The proceeds will be used to refinance existing indebtedness.

China Petroleum is an energy and chemical company based in Beijing.

BankMuscat sells bonds

Oman’s BankMuscat priced $500 million 3¾% notes due May 3, 2021 at 99.311 to yield mid-swaps plus 260 bps, a market source said.

Pricing matched talk, set in the 260 bps area.

Bank ABC, Bank Muscat SAOG, Citigroup, Credit Agricole CIB, HSBC, MUFG Securities, National Bank of Abu Dhabi and Standard Chartered Bank as joint lead managers and bookrunners for the Regulation S offering.

“Their 2018 cheapened up a little on the back of this but still seems supported at z-spread plus 200 bps,” a trader said.

Ziraat Bank prices notes

Turkey-based Ziraat Bank priced $500 million 4¾% notes due April 29, 2021 at 99.701 to yield mid-swaps plus 350 bps, a market source said.

The notes were talked at a spread in 362.5 bps area.

Barclays, Goldman Sachs, Mizuho Securities, Societe Generale and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

Ziraat is an Ankara, Turkey-based lender.

Sigma Alimentos prints bonds

Mexico’s Sigma Alimentos sold $1 billion 4¼% notes due May 2, 2026 at 99.797 to yield Treasuries plus 225 bps, a market source said.

The notes were talked at a spread in the 262.5 bps area.

BofA Merrill Lynch and JPMorgan were the active bookrunners for the Rule 144A and Regulation S deal. MUFG Securities and Rabo Securities were the passive bookrunners.

The proceeds will be used to pay certain existing bank indebtedness and for general corporate purposes.

Sigma Alimentos is a branded foods producer and distributor based in Monterrey, Mexico.

Huawei on roadshow

China’s Huawei Investment & Holding Co. Ltd. started on Monday a roadshow to market a dollar-denominated issue of notes, a market source said.

ANZ, Bank of China, HSBC and Standard Chartered Bank are the bookrunners for the Regulation S deal.

The notes will be issued via Proven Honour Capital Ltd., a subsidiary of the Shenzhen-based provider of information and communications technology solutions and services for telecom carriers, enterprises and consumers.

© 2015 Prospect News.
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