Primary hosts TAQA, IHS, Zhuzhou City, Promsvyazbank, Tenaga; Fed to raise rates ‘soon’

By Christine Van Dusen

Atlanta, Oct. 12 – Abu Dhabi National Energy Co. (TAQA), Nigeria’s IHS Holding, China’s Zhuzhou City Construction Development Group Co. Ltd., Russia’s Promsvyazbank OJSC and Malaysia’s Tenaga Nasional Bhd. sold notes on Wednesday as the Federal Reserve announced it would raise rates “relatively soon.”

“It is calm on the data front otherwise,” a London-based analyst said. “Oil prices remain well-supported by the recent OPEC actions, despite having retreated from Monday’s peak levels. Comments from the sidelines of the World Energy Congress in Istanbul still remain supportive of a final deal to curb output in November, with President Putin also hinting that Russia is willing to join.”

Investors were also watching South Africa after the National Prosecuting Authority (NPA) summoned Finance Minister Gordhan to appear in court on Nov. 2 on fraud charges.

“Many investors also question whether South Africa will be able to retain its investment grade rating if Gordhan is removed,” he said. “South Africa’s risks are certainly biased towards the downside, with structural issues, very low growth, potentially high government contingent liabilities on SOEs, and political uncertainty.”

If Gordhan is removed, the government’s focus is likely to shift away from the country’s economic problems, he said.

“We continue to remain cautious,” he said.

Looking to Turkey, bonds gave back the previous week’s gains as rates and elections “give us the chills,” a trader said. “We are now flattening as the Street and some accounts have started to sell.”

The move wider is on thin flows, he said, “so if we manage to find a footing we could see a quick snap back as locals come in to take out loose bonds.”

Turkey in focus

Banks and corporates have seen their overall valuations tighten up significantly, the analyst said.

“That, combined with the weakness in Russian and South African corporates, is now weighing on the sector as the relative cheapness of Turkey banks and corporates has started to evaporate and the likelihood of supply has probably increased if we firm up,” he said. “Positioning feels long here in the Street, with most auctions filled with sellers.”

Market-watchers were also whispering about possible issuance from the Turkish sovereign before the end of the year.

“My guess is the euro market, post-downgrade, is almost shut,” a trader said. “Sukuk is already done. The 2045 retap was the last trade, so I think the next trade could be a 2026 tap or 2027.”

TAQA prices taps

In its new deal, Abu Dhabi’s TAQA priced $750 million of taps of its notes due 2021 and 2026, a syndicate source said.

The $250 million tap of the existing 3 5/8% notes due 2021 priced at 102.485 to yield 3.05% after talk in the 3.2% area.

The $500 million tap of the existing 4 3/8% notes due 2026 priced at 104.614 to yield 3.8% after talk in the range of 4% to 4 1/8%.

Citigroup, Mizuho Securities, MUFG Securities and Standard Chartered Bank were the bookrunners for the Regulation S deal.

Before the pricing, the existing 2021 notes were trading at 102.10 bid, and the 2026 notes were trading at 104.25 bid, a trader said.

Issuance from Tenaga

Malaysia’s Tenaga sold $750 million 3.244% Islamic bonds due Oct. 19, 2026 at par to yield 3.244%, or Treasuries plus 145 basis points, a market source said.

The notes were talked at 145 bps to 150 bps.

BNP Paribas, Citigroup Global Markets Ltd., CIMB and HSBC were the bookrunners for the Regulation S deal.

Proceeds will be used for general corporate purposes.

Tenaga is an electric utility based in Kuala Lumpur.

Promsvyazbank prints bonds

Russia’s Promsvyazbank priced $250 million 5¼% notes due Oct. 19, 2019 at par to yield 5¼%, or Treasuries plus 421.2 bps, a market source said.

HSBC, ING, JPMorgan, Renaissance Capital and Promsvyazbank were the bookrunners for the Regulation S deal.

Promsvyazbank is a Moscow-based lender.

Deal from IHS

Nigeria's IHS Holding – via IHS Netherlands Holdco BV – priced $800 million 9½% notes due Oct. 27, 2021 at par to yield 9½%, a market source said.

The notes were initially talked at a yield in the mid-9% area.

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

The proceeds will be used to settle a tender offer and refinance bank loans, as well as for general corporate purposes.

IHS is an independent telecommunications tower company based in Lagos.

Zhuzhou City issues

China’s Zhuzhou City Construction priced $300 million 2.98% notes due Oct. 19, 2019 at 99.339 to yield Treasuries plus 217.5 bps, a market source said.

CEB International, ABC International, Dongxing Securities, Haitong International, KGI Asia, Natixis Securities, OCBC Bank and Wing Lung Bank were the bookrunners for the Regulation S deal.

The proceeds will be used for general purposes.

Cable Communications sets talk

In other deal-related news, Netherlands-based Cable Communications Systems NV set talk at 5% to 5¼% for an upsized €350 million issue of notes due in seven years, a market source said.

The deal was initially expected to total €275 million. A proposed Romanian leu-denominated tranche was withdrawn.

JPMorgan, Citigroup, Deutsche Bank, ING, Societe Generale and UniCredit are the bookrunners for the Rule 144A and Regulation S deal.

The notes will be non-callable for three years.

The issuer is an Amsterdam-based cable television company.

Alam Sutera sets roadshow

Indonesia’s PT Alam Sutera Realty Tbk will set out on Thursday for a roadshow to market a dollar-denominated issue of notes (expected ratings: B2/B/B+), according to a company announcement.

JPMorgan and UBS are the bookrunners for the Regulation S deal.

The roadshow will be held in Asia.

Alam Sutera is a property developer based in Tangerang.

Enersis seeks issuance

Chile’s Enersis Americas SA plans to issue dollar notes, according to a company filing.

BBVA, Citigroup, JPMorgan, Morgan Stanley and Santander are the bookrunners for the Securities and Exchange Commission-registered deal.

The proceeds will be used for repayment of the company’s 7.4% notes due Dec. 1, 2016, and its associated derivatives, to repurchase common stock, as part of the overall reorganization of the company’s businesses in Latin America, and for general corporate purposes.

The notes will include a make-whole call.

Enersis holds direct and indirect participation in the electric power generation, transmission and distribution businesses. It holds a 60% interest in Endesa Chile, an electricity generation company. Both are based in Santiago, Chile.

CFE sells bonds

On Tuesday, Mexico’s Comision Federal de Electricidad (CFE) priced $1 billion 4¾% notes due Feb. 23, 2027 at 98.876 to yield Treasuries plus 300 bps, a market source said.

The notes were talked at a spread in the 337.5 bps area.

BBVA and BofA Merrill Lynch were the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used for working capital and for general corporate purposes.

CFE is a Mexico City-based electric company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.