22 de julio de 2015 / 21:01 / en 2 años

LATAM WRAP-Pemex breaks primary lull, while Brazil sinks

NEW YORK, July 22 (IFR) - Mexico’s state-owned oil entity Pemex broke a two-week lull in the primary market for Latin American issuers with a US$525m 10-year bond guaranteed by the US Export-Import Bank.

The Triple A-rated bond did blow a breath of fresh air on a market that up until today had only seen US$1.225bn in supply this month.

In the end, Pemex priced a 2025 amortizer with a 5.63-year average life at par to yield 2.46% or mid-swaps plus 55bp, the tight end of guidance of mid-swaps plus 55bp-57bp.

The pipeline also saw some new arrivals, although they too were hardly pure LatAm plays.

These included Sagicor, an insurance and financial services provider with operations in the Caribbean and the US, as well as Cable & Wireless subsidiary Sable International, which provides telecom services across the region and in the Seychelles.

This came as Brazilian credits suffered another bout of weakness as investors fretted about the government’s ability to implement fiscal measures that will prevent Moody’s from downgrading the sovereign with a negative outlook.

Markets are already expecting the rating agency to cut Brazil’s standing to Baa3 - a notch above junk - but any future price action will depend on whether the rating agency takes a stable or negative view going forward.

Such fears were exacerbated on Wednesday on news that the Brazilian government plans to announce a new primary surplus of 0.15% of GDP, down from the originally budgeted 1.1%.

“After today, the market is expecting a negative outlook,” said Klaus Spielkamp, head of fixed-income sales at Bulltick. “If they come with the stable outlook, the market rallies from here.”

However, Brazilian credits widened anywhere between 20bp-50bp as investors braced for the worst case scenario.

“Before, the selloff only involved credits related to the Petrobras corruption scandal but today it was everyone including banks like Bradesco and Itau,” said a trader.

Against that backdrop, Andean credits were seen as a safe-haven and were catching a bid, with the exception of commodity names like Ecopetrol as oil prices took another tumble today.


Sagicor Financial Corporation, an insurance and financial services provider with operations in the Caribbean and the US, hired JP Morgan and Scotiabank to arrange fixed-income meetings in the US and Europe ahead of a potential US$-denominated 144A/Reg S bond issue.

The meetings will take place in London on July 27, Boston on July 28, Los Angeles on July 29 and New York on July 30. Expected corporate ratings are BB-/B from S&P/Fitch.

Whisper of mid 6%s are being heard on a US$750m 7NC3 from Sable International Finance Limited (Cable & Wireless) as it kicks off roadshows via BNP/JPM/RBC/SCOTIA. Expected ratings are Ba3/B

Timing: London roadshow Wednesday, July 22 - Friday, July 24, US roadshow Monday, July 27 - Friday, July 31. 144a/RegS for life. UOP: Refi Term Loans under the Term Loan Facilities and GCP. Biz: Leading provider of telecommunications-based services in the Caribbean, Latin America, and Seychelles.

Brazilian conglomerate Cosan Overseas has selected banks to take it on a roadshow this week to market a possible 144A/Reg S bond offering.

The company was in Boston and Los Angeles today, and will wrap up in New York and London on Wednesday. Bank of America Merrill Lynch, Bradesco, Itau BBA, Morgan Stanley and Santander are organizing the meetings. Expected ratings are Ba2/BB/BB+ by Moody‘s, S&P and Fitch.

Brazilian refractory company Magnesita has announced plans to buy back as much as all of its outstanding 7.875% senior notes due 2020 and to modify their terms and remove all restricting covenants.

America Movil (A2/A-/A) and Telesites (expected NR/BBB-/BBB-) wrapped up investor meetings via Citigroup, Inbursa, BBVA and Santander. The meetings were intended to discuss the new Operadora de Sites Mexicanos business and gauge interest for 144A/Reg S deals in Mexican pesos and/or USD.

Banco Santander Chile (Aa3/A/A+) wrapped up meetings via Deutsche Bank and Santander to discuss opportunities in the domestic Chilean markets.

Jamaica (Caa2/B/B-) has wrapped up investor meetings via Citigroup. The meetings were described as a non-deal roadshow, but markets have been expecting the sovereign to raise funding to retire a PetroCaribe loan owed to Venezuela. (Reporting by Davide Scigliuzzo and Paul Kilby; editing by Shankar Ramakrishnan)

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