LATAM WRAP-Sagicor takes center stage in quiet primary market
By Paul Kilby
NEW YORK, Aug 3 (IFR) - Insurance company Sagicor cut a solitary figure in Latin America's moribund primary market on Monday as it released price thoughts of low 9s on a US$320m seven-year non-call five.
The deal from Sagicor, which provides insurance and financial services in the Caribbean and the US, is being marketed to both EM and US high-yield accounts.
But its Barbados postal code has some analysts comping it against Caribbean sovereigns and other regional credits.
At current IPTs, the deal is seen as cheap in light of a potential upgrade over the coming months as the company relocates from Barbados (B3/B) to a higher-rated country such as Trinidad, which is rated Baa2/A.
"It is likely the bond issues might be upgraded to the BB-/BB range," Omar Zeolla, an corporate credit analyst at Oppenheimer, wrote on Monday.
The company's ratings have fallen along with the fortunes of Barbados, which has suffered multiple-notch downgrades in recent years as its fiscal health deteriorated in the wake of the global financial crisis.
"They are devoting new capital to Trinidad and the US and they are trying to grow away from lower-rated countries," said a banker.
Other positives include strong interest coverage of more than seven times, as well as conservative reserve and risk-management practices, said Zeolla. Continuación...