Colombian utility EEB preps bond refinancing

martes 7 de abril de 2015 12:20 GYT

By Davide Scigliuzzo

NEW YORK, April 7 (IFR) - Colombian utility Empresa de Energia de Bogota (EEB) has received a green light from shareholders to issue new debt as part of its refinancing of a US$749m bond maturing in 2021.

The potential liability management transaction could allow EEB to replace its 2021 bond, which currently pays a coupon of 6.125%, with a longer-dated note carrying a lower coupon, according to an investor presentation filed with the local regulator.

The 2021s, which were being quoted Tuesday at a mid-market price of around 106.00, are callable at 103.063 on November 10 2016. The bond, however, also carries a make-whole call that would allow the company to redeem the issue before then.

"According to indications received from the market, the most liquid tenor for a potential issue from EEB is 10 years," the company said in the presentation. "However, for corporates like EEB the 30-year tenor could also be an alternative given current market conditions."

The company's longest bond along its dollar curve is a 4.375% 2023, which is currently trading around 4.2% on a yield basis, according to Thomson Reuters data.

EEB shareholders, which include the City of Bogota (76.3%) and state-run oil company Ecopetrol (6.9%), approved the refinancing and new issue plans at their annual meeting on March 30.

Latin America bankers contacted by IFR said the company is yet to issue a request for proposals ahead of any potential transaction.

"They are probably examining different alternatives and they have some time to evaluate them," said one New York-based originations banker. "I don't think there is anything more specific than that."

EEB, which is rated Baa3/BBB-/BBB by Moody's, S&P and Fitch, said it might consider using a potential new issue to also raise additional funds to finance investments. (Reporting by Davide Scigliuzzo; Editing by Paul Kilby)