Chile's Tanner postpones bond sale until next year
By Paul Kilby
NEW YORK, Nov 10 (IFR) - Chilean financial company Tanner Servicios Financieros has postponed a US$300m bond sale until next year as it awaits better market conditions, a source told IFR on Tuesday.
Tanner (BBB-/BBB-) delayed the sale of a five-year bond on Friday after US Treasury yields widened in the wake of a stronger-than-expected jobs print in the US. It had hoped to return on Monday once market conditions had settled down.
But the deal seemed ill-timed to bankers who questioned why Tanner would try to print on a key data day, especially amid speculation about a Federal Reserve rate hike in December.
"We were surprised that they would test the market on Friday ahead of one the most anticipated economic numbers," said a syndicate manager.
Some also thought initial talk of 5.5% area too aggressive.
On Friday, that translated into a spread of around 377bp over Treasuries, or a concession of around 25bp over fair value, after accounting for an additional 25bp-30bp of curve extension, said a banker away from the deal.
"It looks on the tight side," said the banker, who had the company's March 2018s quoted at 100.375 for a spread of 318bp over US Treasuries.
This comes at a time when investors are largely in defensive mode ahead of year-end and less willing to take risks on a relatively small issue from a lesser-known credit. Continuación...