Bankers try bond after lackluster response to Pemex asset loan
By Paul Kilby
NEW YORK, June 7 (IFR) - Banks are marketing a 15-year bond of around US$500m in size to finance KKR's purchase of Pemex assets after failing to attract sufficient interest in a previous loan deal, sources told IFR.
Morgan Stanley is left-lead on the bond, which could price as soon as next week, with Credit Agricole, Mizuho and SMBC also participating as bookrunners, the sources said.
The bond is expected to fill the gap left over from a multi-tranche loan that had been expected to be US$1.35bn in size, but was reduced to US$500m amid push-back over exposure to Pemex and the broader oil and gas sector.
"It was an ambitious number but they were restricted by market appetite," a loan banker told IFR.
"The risk is mitigated because it is secured by assets that Pemex needs to operate, but certain banks have already capped their exposure [to Pemex]."
Only four banks participated, even after margins were flexed higher.
A US$100m 12-year term loan finally landed at around Libor plus 360bp, some 85bp wide to the original 275bp spread, according to a source.
A US$115m five-year and US$235m 10-year term loan, as well as a US$50m five-year revolver, were also flexed in a similar manner, he said. Continuación...