Gazprom, Corporacion Andina de Fomento bring deals; secondary spreads slightly wider

By Rebecca Melvin

New York, Feb. 6 – Russia’s PJSC Gazprom was talking a benchmark-sized issue of seven-year dollar-denominated notes to yield in the area of 5 3/8% early Wednesday, and Venezuela’s Corporacion Andina de Fomento (CAF) priced $1.25 billion of 3¼% notes to yield mid-swaps plus 72 basis points, according to market sources.

Final terms were not heard on the Gazprom deal by Prospect News’ deadline. But the pricing window for Russian issuers has opened up since last month when the United States lifted sanctions on Moscow-based aluminum company United Co. Rusal plc. And there is now more supply for the Central and Eastern European region, in general.

Credit Bank of Moscow joined the new issue calendar for a euro-denominated offering of three- to five-year notes. That deal will be going on the road on Thursday with pricing seen next week.

Uzbekistan is also proposing a sovereign notes deal debut, with a five- to 10-year maturity, that will begin roadshow meetings on Thursday.

In addition, the Arab Republic of Egypt has gone up on the calendar after the sovereign named banks chosen to manage planned offerings of dollar- and euro-denominated notes and green bonds expected in the next few months, according to the country’s finance ministry.

The deals are expected to be priced by June, the end of Egypt’s fiscal year.

The new issues follow on a new benchmark for Republic of Paraguay this week. The South American sovereign priced $500 million of 5.4% 2050 notes at 99.987 on Tuesday for a yield spread of 234 bps over U.S. Treasuries, according to a market source.

Pricing was tightened from initial talk for 5.65% area yield.

Proceeds are earmarked for capital expenditures and to refinance a portion of outstanding debt.

In the secondary space, spreads shifted a bit wider on Thursday, but the market is in good shape generally, a London-based trader, focused on the Middle East and Africa region, said.

MENA new deal supply was lacking owing to the quieting effect of the Chinese New Year holiday, the trader said. “But hopefully [there will be] some next week.”

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