Credit Bank of Moscow leads Ziraat, KOKS out of new deal gate; Asian Development prices notes

By Colin Hanner

Chicago, April 27 – Activity was consistent with the previous sessions in emerging markets, as new issues knocked out most of the new-deal pipeline in the Russian commonwealth.

Of the three that priced – as of press time – Credit Bank of Moscow saw the biggest deal with $700 million of perpetual bonds that priced at par, the company said.

The yield will be 8 7/8% for the first five years, then step up to the five-year dollar swap rate plus 694.2 basis points until maturity.

Initial price guidance was in the 9% to 9¼% area, a market source said.

The bonds, which will be issued through CBOM Finance plc, are non-callable for 5½ years, the company said.

Societe Generale CIB, JPMorgan, Citigroup, HSBC, RBI Group, BK Region and Credit Suisse were bookrunners for the deal.

The variety of new issues are meeting demand in emerging markets, a market source said, with investors overbooking deals by two- and threefold.

“New issues are the easy option, and syndicate desks are using that to bring deals with minimal [new-issue premiums],” a market source said.

Ziraat tightens

Ankara, Turkey-based Turkiye Cumhuriyeti Ziraat Bankasy AS priced $600 million of 5 1/8% five-year notes at 99.457 to yield 5¼%, a market source said.

Initial price talk for the deal was in the 5½% area, a market source said.

BofA Merrill Lynch, Citigroup Global Markets Ltd., Erste Group Bank AG, Emirates NBD and J.P. Morgan Securities plc were bookrunners for the Rule 144A and Regulation S deal.

KOKS’ half-billion deal

Moscow-based coke and pig iron producer and miner, KOKS Finance DAC, priced $500 million of 7½% five-year notes at par on Thursday, a market source said.

Initial price talk for the deal was in the 7¾% area, later tightening to 7½%.

Citigroup, Gazprombank, Renaissance Capital, Sberbank CIB, VTB Capital were bookrunners for the deal.

The new notes are part of a refinancing that includes a cash tender offer for the company’s 10¾% notes due 2018, a market source said.

ADB prices over $4 billion

The Asian Development Bank priced $4 billion of 1 5/8% three-year notes at 99.776, the company said.

The issue will yield a spread of 23.2 bps over the 1.5% U.S. Treasury note due April 2020.

BMO Capital Markets, Citi, Deutsche Bank and RBC Capital Markets were lead managers for the deal.

Proceeds will go toward ADB’s ordinary capital resources.

Draining pipeline

Expected to close out the week in benchmark new issues in Eastern Europe is Kiev, Ukraine-based agriculture-industrial company, MHP SA, which is set to price dollar-denominated seven-year bullet notes on Thursday, a market source said.

The new notes are part of a refinancing that includes a cash tender offer for up to $350 million of the company’s $750 million 8¼% notes due 2020, the company said. The size of the deal will depend on the tender results, a market source said.

JPMorgan Securities plc and ING are stabilizing managers for the deal.

A roadshow for the deal took place from Monday through Wednesday.

Oil’s not affecting Saudi

As crude oil futures dropped on Thursday due to U.S. figures showing increased production, as well Libya opening production in its biggest field, several Middle Eastern sovereigns, including Saudi Arabia, did not falter.

“[West Texas Intermediate] below $50 is not having an impact on the Middle East names,” a market source said.

Compared to Saudi’s opening on Thursday, its 2 3/8% notes due 2021 were up 6 bps to a 98¼ bid, 98.37 offer.

And its 3.628% notes due 2027 were unchanged at a 100.45 bid, 100.55 offer.

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