Estonia’s Luminor Bank prices despite market turbulence; Mabe, CMI join Latin America primary calendar

By Rebecca Melvin

New York, Oct. 10 – Luminor Bank AS (Estonia) announced and priced €350 million of 1.5% three year notes on Wednesday despite a selloff that hit the broader markets, as risk-off sentiment drove a volatility spike.

The Luminor notes priced to yield mid-swaps plus 150 basis points. Also in emerging markets, the Latin America region has managed to cue up a trio of planned new issues in recent sessions. Mexican appliance maker Controladora Mabe SA de CV announced a $350 million offering of senior unsecured notes with an up to 10-year maturity, and Guatemala’s Corporacion Multi Inversiones (CMI) will begin investor meetings on Thursday regarding a dollar-denominated green bond of intermediate maturity. These deals join emerging markets-focused Millicom International Cellular SA, which plans to price a $500 million deal of senior unsecured notes due 2026.

In the secondary market, bond pricing was weaker. In the early going, rates were mostly steady and spreads were only narrowly mixed in the Middle East and Africa region. Later, investors sought the safety of U.S. Treasuries, driving yields lower. The CBOE volatility index spiked more than 43%, and U.S. stocks had their worst day since February, with the Dow Jones industrial average closing down 831 points, but the tech-heavy Nasdaq stock market doing even worse, closing down 4%, with selling continuing in after hours in New York.

The Trump Administration weighed in on the market selloff, issuing several statements that touted the strong fundamentals of the U.S. economy with Trump policies “creating a solid base for continued growth.”

Meanwhile, world equities fell to a three-month low. The major European equity indexes fell more than 1%, mostly on weaker technology shares.

Luminor brings euro deal

Luminor’s €350 million of 1.5% three-year notes priced to yield a spread of mid-swaps plus 150 basis points.

The notes had a reoffer price of 99.698 for a 1.604% yield.

The notes were sold via joint bookrunners Citigroup, Goldman Sachs, JPMorgan and Nordea (bill and deliver).

Luminor is a recently created bank from the merger of Nordea Bank AB and DNB Bank ASA’s operations, with ownership changing to Blackstone private equity fund.

Mabe to price $350 million deal

Mexico’s Mabe plans to price senior unsecured notes of up to 10-year maturity, which will be used to pay for a tender offer for $350 million of 2019 notes as well as for general corporate purposes.

JPMorgan, Citigroup and Scotia are joint bookrunners of the deal.

The company is offering $1,046.80 per $1,000 principal amount of notes tendered by the early deadline of 8 a.m. ET on Oct. 18. Included in the payment is a $30.00 per $1,000 early tender premium that will only be paid for notes submitted by the early deadline. The tender ends at 12 a.m. ET on Oct. 31.

Mabe is a Mexico City-based manufacturer of ranges, refrigerators, clothes dryers and washing machines.

CMI eyes green bond

Guatemala’s CMI is sending out two teams for roadshows of its planned dollar-denominated green bond of intermediate maturity, according to a syndicate source.

Roadshow meetings will be held in Geneva, Zurich, London, Boston, New York and Los Angeles.

Credit Suisse and Citigroup are bookrunners of the Rule 144A and Regulation S deal.

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