Pemex returns with bond deal after long hiatus

martes 13 de septiembre de 2016 12:30 GYT

By Paul Kilby

NEW YORK, Sept 13 (IFR) - Mexico's Pemex returned to the dollar market for the first time in close to nine months on Tuesday with a two-part bond as it sought to raise new money and retire debt across its curve.

The borrower is approaching investors with seven and 30-year paper with initial price thoughts of 4.75% area and 6.75% area, respectively.

At those levels, both bonds are seen coming about 60bp wide to the company's curve, where 3.5% January 2023s and the 5.625% 2046s had been trading pre-announcement at 4.17% and 6.17%, respectively.

That appears to be a decent enough concession to draw interest, but given the shaky state of Tuesday's market, Pemex may have little room to tighten from here.

"The market is not supportive so we expect that they will need to maintain a decent concession," said Jason Trujillo, a senior analyst at Invesco.

Broader markets looked fragile on Tuesday as oil slipped in early morning trading amid ongoing uncertainty over monetary policies across the developed world.

"Oil credits remain complicated but we are in a much better place now," said a DCM banker away from the trade.

Concessions may have to be decent also because with increased expectations of a US interest rate hike later this year, investors may be cautious about taking on duration risk, said one investor.   Continuación...