LATAM WRAP-Bankers hope better tone will entice LatAm issuers
By Paul Kilby
NEW YORK, July 16 (IFR) - An improved backdrop for global markets on Thursday has bankers hoping more LatAm borrowers will leap through what is an approximately two-week window before the August doldrums set in.
So far, America Movil's wireless tower spin-off Telesites, Chilean copper giant Codelco and the Jamaican sovereign are all seen as possible issuance candidates.
This comes amid local press reports that the Jamaican government is close to cutting a deal with Venezuela to buy back outstanding PetroCaribe debt at a steep discount.
The Caribbean nation is expected to fund the liability management operation through a bond issue, much like the Dominican Republic did earlier this year.
Jamaica recently wrapped up investor meetings through Citigroup, but according to two investors contacted by IFR, the bank has yet to approach the buyside about a deal.
Making such a trade economical will likely require Venezuela providing a substantial haircut on the PetroCaribe debt - which carries interest of between 1-2% - given fact that Jamaica will have to pay around 6% on a 10-year offering, say observers.
Issuing a 10-year bond may also prove tricky if the government wishes to avoid uncomfortable amortization spikes in 2025, when it already has two bonds maturing, said one investor.
A 15-year may be more suitable for the country's maturity profile, while a dual-tranche offering may offset some of the costs of issuing longer-dated paper, say bankers. Continuación...