UPDATE 3-Buenos Aires province plans new 6-year US dollar bond
(Adds new book size, revised pricing)
By Davide Scigliuzzo and Paul Kilby
NEW YORK, June 2 (IFR) - The Province of Buenos Aires tightened pricing on its first international bond sale since 2011 after demand for the US$500m deal topped US$2bn on Tuesday.
The borrower has set price guidance of 10.25%-10.35% for the six-year bond sale, inside initial price thoughts of mid 10%s released earlier.
Strong demand comes despite a relatively small new issue premium, considering that the Province's existing 2021s have been trading at a mid-market yield of around 10.35%.
"They are issuing on the curve with virtually no premium," said a New York-based trader. "Local guys are not interest because of the risk, but they like the coupon."
Other accounts, however, have expressed interest in the bond in what remains a low yield environment.
"At first glance mid 10% sounds fair," said one investor evaluating the issue. "They will come in the low 10%s, but that would still be fairly attractive."
Jorge Piedrahita, CEO at brokerage Torino Capital, argued that even if priced at the tight end of guidance the new notes would still offer value to investors. Continuación...