IRSA, YPF try to beat Argentine supply surge

jueves 17 de marzo de 2016 15:36 GYT

By Paul Kilby

NEW YORK, March 17 (IFR) - Argentine real estate company IRSA and oil name YPF are rushing to market this week ahead of an expected flood of issuance from the country in the coming months.

Following the sovereign's agreement with holdout creditors last month, Argentina's borrowers are weighing when best to issue bonds amid expectations of a supply surge this year.

The government moved closer to an expected US$11.68bn bond sale to pay litigant investors on Wednesday when it won the lower house's approval for the debt agreement.

President Mauricio Macri is expected to get the bill passed in the Senate later this month so that the government can issue the jumbo bond by a mid-April payment deadline.

IRSA and YPF are getting in ahead of the sovereign, as well as provinces and other corporates, as those deals could pressure secondary spreads and complicate deal execution.

"It is a tough zip code to think about," one syndicate manager told IFR. "It doesn't necessarily trade the way other countries do given the technicals."

Indeed, markets may already be pricing in expected supply dynamics - whether or not borrowers come before the government's jumbo offering.

"Given that we will have about US$35bn in new issuance out of Argentina this year, all issuers should pay a concession: otherwise investors should not buy it," said a broker.   Continuación...