Brazil’s Klabin prices $1 billion in dual tranches; Sharjah prices $1 billion sukuk

By Rebecca Melvin

New York, March 27 – Klabin Austria GmbH issued on Wednesday $1 billion of senior unsecured notes in two equal tranches due 2029 and 2049 concurrently with a tender for existing notes.

The notes, guaranteed by Klabin SA, include $500 million of 5¾% note due 2029 and $500 million of 7.0% note due 2049.

The Government of Sharjah’s newly priced sukuk also hit the market with a $1 billion deal of seven-year paper, which bears a distribution rate of 3.854%. Spread was set at mid-swaps plus 155 basis points, which was tightened a good chunk from talk at mid-swaps plus 180 bps and represents only a slight new issue premium.

Order books for the deal reached $4.3 billion ahead of the launch.

Russia-focused steel company Evraz plc priced $700 million of 5¼% five-year notes at par. The Rule 144A and Regulation S notes will be used to refinance debt, including its senior notes due 2020.

Also debuting in the market was Tbilisi, Georgia-based telecommunications company Silknet JSC, which priced $200 million of 11% notes due 2024 at par. The notes, which are non-callable for three years, are expected to be used to refinance the company’s existing debt.

Joining the forward calendar were Russia-based diamond mining company Alrosa Co. Ltd., which is planning to price a benchmark offering of U.S. dollar-denominated notes at the conclusion of roadshow meetings that are being held this week. Alrosa is also tendering for up to $400 million of its $894,384,000 of outstanding 7¾% notes due 2020.

Also announcing liability management news were Minerva SA, which announced a consent solicitation relating to its 6½% notes due 2026 and 5 7/8% notes due 2028, and Banco Hipotecario SA of Argentina, which announced early tender-offer results for $75 million of 9¾% notes due 2020.

Venezuela crises grind on

In other news, the European Commission announced that it is allocating another €50 million in emergency aid to help Venezuela’s most vulnerable citizens, raising the EU’s total allocation to the struggling Latin American country to €117.6 million since 2018.

The additional support includes emergency shelter, healthcare, food assistance, nutrition services, access to safe water and sanitation as well as children’s education.

Economic recession and hyperinflation in Venezuela are in their fifth year and have created worsening social crises including a breakdown in health, education and other services. Most recently the country is suffering from nationwide power outages.

Meanwhile, pressure continues to mount from the United States and other countries for regime change. Fabiana Rosales, the wife of Venezuelan opposition leader Juan Guaido, was welcomed at the U.S. White House on Wednesday as she seeks to raise support for the ouster of President Nicolas Maduro. Earlier this year, Guaido proclaimed himself interim president of the country, asserting that the re-election of Maduro last May was fraudulent.

“Today, in Venezuela it is freedom or dictatorship, it is life or death,” Rosales said during her White House visit, according to the Associated Press.

An estimated 3.4 million people have fled Venezuela into other parts of Latin America since the troubles began, in what is the largest ever recorded for the region, according to the United Nations.

© 2015 Prospect News.
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