Issuance from Korea Water Resources; risk appetite declines again; roadshow for Woori Bank

By Christine Van Dusen

Atlanta, Oct. 8 – Korea Water Resources Corp. sold notes on Wednesday as global risk sentiment continued to deteriorate, this time primarily in response to the International Monetary Fund’s global outlook.

The IMF has cut global growth projections for 2014 and 2015, sending most emerging markets assets wider on Wednesday, a London-based analyst said.

This – along with continued ISIS-related activity on the Syrian border – kept investors skittish during the session.

Still, the impact was limited on Syria’s neighbor, Turkey, which saw credit default swaps widen just 2 basis points, he said.

“Following the better performance after Turkey’s rating affirmation by Fitch on Friday, bond prices have largely stalled,” he said.

Meanwhile, credit default swaps spreads for Russia were 3 bps wider on Wednesday.

And demand for the new issue of bonds from Kazakhstan faded somewhat. The 10-year notes were about 20 bps wider and the 30-years about 14 bps wider from issuance, he said.

From the Middle East, trading was “another mixed bag,” a London-based trader said. “Spreads are struggling to keep pace with a U.S. Treasury bid on the back of weaker equity markets.”

Perpetuals were unchanged in the morning, with balanced flows for Emirates NBD and buyers for Abu Dhabi Islamic Bank.

“Once again, though, there is a good deal of interest in investment-grade names,” he said. “Emaar Properties, Abu Dhabi National Energy Co., Qtel International and Majid Al-Futtaim Holding were all popular.”

The long end of Saudi Electricity Co. looked “OK,” on a spread basis, with its curve about 15 bps to 20 bps wider on the month.

Sharjah widens, Qatar popular

The recent issue of notes from Sharjah –3.764% Islamic bonds due 2024 that priced at par to yield mid-swaps plus 110 bps – widened on Wednesday, the London trader said.

HSBC, Kuwait Finance House, National Bank of Abu Dhabi, Sharjah Islamic Bank and Standard Chartered Bank were the bookrunners for the Regulation S deal.

“We saw a little bit of nibbling on Dar al Arkan’s 2015s,” he said. “There were sneaky bids for Kipco’s 2019s again and Burgan Bank’s perpetuals. Qatar 2022s are popular, closing 5 bps better. Also seen some long-awaited nibbling on Dubai Holding’s 2017 sterling notes.”

Korea Water prints bonds

In its new deal, Korea Water Resources priced $300 million 2% notes due April 16, 2018 at 99.886 to yield 2.034%, or Treasuries plus 107.5 bps, a market source said.

BNP Paribas, Deutsche Bank, Goldman Sachs, Morgan Stanley and Standard Chartered Bank were the bookrunners for the Regulation S-only deal.

The company, based in Daejeon, oversees South Korea's water resources.

Swissco sells notes

Singapore’s Swissco Holdings Ltd. priced S$100 million 5.7% notes due April 16, 2018 at par to yield 5.7%, a market source said.

OCBC was the sole bookrunner for the deal.

The Singapore-based company provides marine services to the shipping and offshore oil and gas industries.

Woori Bank sets roadshow

South Korea’s Woori Bank has mandated Barclays, Commerzbank, Deutsche Bank, HSBC, Nomura Securities and Standard Chartered Bank to lead a roadshow starting Oct. 13, a market source said.

An issue of notes could follow.

The lender is based in Seoul.

Romania seeks issuance

Romania has mandated banks for a euro-denominated issue of notes, a market source said.

HSBC is among the bookrunners for the deal.

The notes are expected to price by the end of the year.

The proceeds will be used to pre-finance some of its 2015 needs.

InRetail does deal

On Tuesday, Peru’s InRetail Consumer priced $300 million 5¼% notes due Oct. 10, 20121 at 99.279 to yield 5 3/8%, a market source said.

Citigroup and Credit Suisse were the bookrunners for the Rule 144A and Regulation S notes.

The proceeds will be used to fund a buyback of the company’s 8 7/8% notes due in 2018.

The tender offer for all $300 million of the outstanding senior notes began earlier this month. InRetail expects to settle purchases of notes tendered by the early deadline on Oct. 10.

InRetail Consumer is the pharmacy and supermarket division of Intercorp Peru, a conglomerate based in Lima.

© 2015 Prospect News.
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