June 7, 2016 / 9:12 PM / 2 years ago

LATAM CLOSE-Vale Overseas raises US$1.25bn in LatAm primary

* Brazil’s Vale back in market after long hiatus

* Bankers try bond after poor response to Pemex asset loan

* Mexico’s GICSA starts roadshows

* Banco Pan announces early tender results

* Marfrig agrees to purchase US$500m plus in debt

By Mike Gambale and Paul Kilby

NEW YORK, June 7 (IFR) - Below is a recap of primary issuance activity in the LatAm market on Tuesday:

Number of deals priced: 1

Total issuance: US$1.25bn


Vale Overseas Limited (VALEBZ), Ba3/BBB-/BBB, announced a US$ benchmark SEC registered 5-year senior unsecured notes. Joint Books are BB Securities, Bank of America, Bradesco BBI, HSBC and Santander. The notes are guaranteed by Vale S.A. and contain a MWC. UOP: General Corporate Purposes, including the repayment of indebtness.

IPT: very low 6%

PRICE GUIDANCE: 5.875%-6.0%

LAUNCH: US$1.25bn five-year bond at 5.875%

PRICED: US$1.25bn 5.875% cpn 5yr (6/10/2021). At 100, yld 5.875%. Spread: T+464.1bp. MWC+50bp. 1st pay: 12/10/2016.

BOOK: US$4.6bn

NIC: About 12.5bp


Brazilian conglomerate Cosan will hold a one-day roadshow this week as it seeks to market a 144A/RegS bond deal after mandating Bank of America Merrill Lynch, Bradesco, Citigroup, HSBC, Itau and Santander.

The borrower will meet investors on June 8 in New York, London, Boston and Los Angeles. The company, which is involved in bioethanol, sugar, energy and foods, is rated Ba2/BB/BB+ with negative outlooks from all three major rating agencies.

The deal is being done in conjunction with a consent solicitation and tender for any and all of its US$500m of 5% 2023s and its BRL850m (US$243m) of 9.5% 2018s.

Holders who tender by the early bird date of June 17 will receive a tender price of 96.00 on the 2023s and 95.00 on the 2018s. Thereafter but before expiration of July 1, those prices dropped to 93.00 and 92.00 respectively.

Energy company ContourGlobal Power Holdings (BB-/BB-) has mandated Goldman Sachs for a 550m senior secured 5NC2 trade.

Roadshows took place in London on Tuesday and will head to Paris and Frankfurt on June 8 and Milan on June 9.

The company has also launched a cash tender on its 7.125% senior secured 2019s. ContourGlobal is offering US$1,037.51 for every US$1,000 tendered.

The Government of the United Mexican States (A3/BBB+/BBB+) have revised guidance on its latest Samurai offering.

The sovereign has narrowed talk on the three-year tranche to 0.40%-0.45% from 0.40%-0.50%, while tightening the five-year notes to a range of 0.70%-0.75% from 0.70%-0.80%.

Daiwa, Mitsubishi UFJ Morgan Stanley and Nomura are joint lead managers. The transaction is expected to price as early as Thursday.

Mexico’s last Samurai was a ¥60bn (US$592m) print in July 2014 that included its first 20-year tranche.

Mexican real estate investment trust Fibra Uno started roadshows this week as it seeks to market a potential US dollar 144A/Reg S bond.

The borrower wrapped up investor meetings in Boston and New York on Tuesday. BBVA, Deutsche Bank, Goldman Sachs and Santander have been mandated as leads. Ratings are Baa2/BBB by Moody’s and Fitch.

Argentina’s Cablevision SA finished roadshows on Tuesday after marketing an up to US$500m bond sale through leads Deutsche Bank, Itau and JP Morgan.

Expected ratings are B3/B+. Proceeds to refinance existing debt and for general corporate purposes, according to Moody’s. The pay TV and internet service provider is majority-owned by media conglomerate Grupo Clarin.

Brazilian pulp and paper company Eldorado has mandated Bank of America Merrill Lynch, Credit Suisse, BB Securities and Santander to market a USD 144/Reg S bond to international investors. The borrower will wrap up roadshows in Boston on June 8.

Goldman Sachs is on the road marketing a US$500m financing package for Colombian road project Costera.

The borrower is looking at dollar bonds as well as inflation-linked peso bonds and loans, according to Fitch, which assigned a BBB- rating to the notes.

Mexican real-estate developer Grupo GICSA kicked off international roadshows on Tuesday to market a US dollar bond through JP Morgan and Santander.

The company was in Santiago on Tuesday, and will head to Los Angeles on Wednesday and Thursday and New York on Friday. The following week, it meet investors in London on June 13, in Boston on June 14 and in New York on June 15. Expected ratings are BB/BB-.

Banks are marketing a 15-year bond of around US$500m in size to finance KKR’s purchase of Pemex assets after failing to attract sufficient interest in a previous loan deal, sources told IFR.

Morgan Stanley is left-lead on the bond, which could price as soon as next week, with Credit Agricole, Mizuho and SMBC also participating as bookrunners, the sources said.

The bond is expected to fill the gap left over from a multi-tranche loan that had been expected to be US$1.35bn in size, but was reduced to US$500m amid push-back over exposure to Pemex and the broader oil and gas sector. (Reporting by Mike Gambale; Editing by Paul Kilby and Natalie Harrison)

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