UPDATE 1-Sigma tightens 10-year bond on strong demand
(Adds launch details, Fitch and banker comments)
By Paul Kilby
NEW YORK, April 25 (IFR) - Sigma on Monday became the first high-grade Latin American corporate to tap the dollar market this year, amassing more than US$3.5bn of orders for a new US$1bn 10-year bond.
Strong demand for the Mexican frozen food company, rated Baa3/BBB/BBB, allowed leads Bank of America and JP Morgan to launch the deal at 225bp, well inside IPTs of 262.5bp area and at the tight end of official guidance of 235bp area.
"It looks like a pretty aggressive print, but they are coming on the back of a week that enjoyed strong tailwinds from Argentina," said a syndicate banker away from the deal.
"This is the first pure high-grade dollar deal out of Latin America all year."
Blue chips names including telco America Movil and Femsa have raised euros this year, but Sigma is the first company this far up the credit spectrum to raise dollars, not counting quasi sovereign names like oil company Pemex.
Spreads on the new deal are coming substantially inside debt issued by Alfa, Sigma's Baa3/BBB-/BBB- rated parent, which has 2024s trading at a G-spread of anywhere between 260bp and 265bp.
As the highest revenue generator among Alfa's subsidiaries last year, Sigma had been expected to come tight to its holding company - but perhaps not quite as much. Continuación...