7 de diciembre de 2015 / 20:55 / hace 2 años

LATAM WRAP-Venezuela bonds rebound on election result

NEW YORK, Dec 7 (IFR) - Venezuela stole the limelight in Latin America on Monday after partial results in the weekend’s election showed the opposition party with a handy win over the ruling Socialists.

International bonds issued by both Venezuela and state-owned oil company PDVSA jumped as much as four points in early trading before retracing slightly.

Venezuela’s 12.75% 2022s were ending the day at 51-52, according to a Miami-based broker, while PDVSA’s 6% 2024s were spotted at 37-38.

“The jump of two to three points we are seeing does not reflect the tectonic change happening in Venezuela,” said Jorge Piedrahita, chief executive of brokerage Torino Capital.

Activity in the region’s primary markets meanwhile has ground to a halt, with Argentina’s Medanito seen as one of the few borrowers who could still tap before year-end.

The oil and gas producer began meeting investors Monday for a potential bond sale, but the company risks jumping the gun after the election of a new reform-minded government.

Market-friendly president-elect Mauricio Macri could remove price controls that have artificially propped up the domestic oil sector and undertake other broad energy sector reforms.

And that could spell trouble for investors buying into the offering from Medanito, which is expected to raise at least US$150m with the bond sale in order to refinance existing debt.

Thanks to government price support, Medanito has been selling crude at around US$75 per barrel, one portfolio manager who met with company officials told IFR.

That is nearly double the market rate for West Texas Intermediate, the US benchmark crude, which on Monday tumbled to its lowest in nearly seven years.

“If the market is opening up and (international) oil is getting into the system this price needs to come down,” said the portfolio manager.

“It won’t happen overnight, but it makes me worried about how (Medanito‘s) cashflow will be impacted.”


Argentina’s E&P company Medanito selected Itau and UBS to take it on an international roadshow ahead of a possible capital markets transaction.

The company will met fixed income investors in London on Monday before heading to Switzerland on December 8 and New York on December 9 and 10. Expected rating is CCC+ by Fitch.

Pemex (Baa1/BBB+/BBB+) mandated Barclays and HSBC for an investor call that was scheduled for Wednesday.

Arcos Dorados, the largest McDonald’s franchiser in South America, has finished Swiss road shows via Credit Suisse. The Argentina-based, NY-listed company is rated Ba3/NR/BB+.

Mexican white-goods manufacturer Controladora Mabe has finished investor meetings through Barclays, Bank of America Merrill Lynch, Citigroup and JP Morgan. Ratings are BB+/BB+.

Brazilian airline Gol (B3/B-/B-) has completed roadshows with Morgan Stanley, Credit Suisse and Citigroup. (Reporting by Davide Scigliuzzo; Editing by Marc Carnegie)

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