E-CL bond adds to flurry of corporate credit issues from Chile

viernes 24 de octubre de 2014 10:05 GYT
 

SANTIAGO Oct 24 (Reuters) - Chilean energy firm E-CL has announced a 10-year $350 million bond issue, IFR reported on Friday, capping a week of activity in Chile's corporate credit market.

E-CL, which is controlled by GDF Suez, flagged earlier this month it might look to tap credit markets as it eyes development projects including a $700 million transmission line to connect Chile's main grids.

The company, whose debt is rated BBB by S&P and Fitch, supplies energy to northern Chile, where the bulk of the country's mines are located. It has set initial price thoughts of 250 basis points over U.S. treasuries, IFR said.

The issue follows on from a launch on Thursday by fertilizer company SQM of a $250 million bond maturing in 2025, with a rate equivalent to about 215 basis points above U.S. treasuries.

SQM owns the rights to huge nitrate and lithium reserves in the Atacama desert, although falling global prices for agricultural chemicals have eroded its profits this year. Companies linked to it have also been at the center of a trading scandal that has roiled Chile.

On Wednesday, Falabella, one of South America's largest retailers, placed $400 million of 10-year debt, also priced around 215 basis points above U.S. treasuries and almost six times over-subscribed.

Despite a recent slowdown and continued dependence on copper exports, Chile's political stability, open economy and the regional diversification of its companies contribute to it being seen as an attractive option by many international investors.

Its sovereign dollar bond yield spreads are around 150 basis points over U.S. treasuries, among the narrowest in emerging markets.

(Reporting by Rosalba O'Brien; Editing by Andrea Ricci)