Argentina preps high-stakes bond trade

viernes 15 de abril de 2016 12:48 GYT

By Paul Kilby and Davide Scigliuzzo

NEW YORK, April 15 (IFR) - The stakes are high for Argentina as it prepares to price its first international bond next week in 15 years - a deal that could end up as the largest emerging-markets trade ever.

The country is looking to raise as much as US$15bn in new debt to pay litigant investors and bring a long-running battle in US courts to an end.

A deal of that size is ambitious for any borrower at any time, not to mention a country with a struggling economy and divided government that is just coming out of default.

"We have had no precedent for this in EM," Bianca Taylor, a senior sovereign analyst at Loomis Sayles, told IFR. "A sovereign has never come with US$15bn at once."

Seven banks are on the trade: global coordinators Deutsche Bank, HSBC, JP Morgan and Santander along with joint books BBVA, Citigroup and UBS. Underwriters could be paid a total of US$27m for their efforts if the size reaches US$15bn.

And all seven will have to pull out the stops in order to even cover a US$15bn offering two times - and hit Argentina's average yield target of 7.5%.

Banks will be turning to dedicated EM accounts and crossover buyers worldwide as it drums up interest for the deal's five, 10 and 30-year tranches.

Smaller retail tickets are also likely to be included to capture the deep pockets of Latin American offshore money.   Continuación...