NEW YORK, April 20 (IFR) - LatAm credit markets were off to a mixed start Monday, though the tone was supportive enough for Southern Copper Corporation to pull the trigger on a new 10s/30s bond sale.
Traders were reporting a largely quiet beginning to the week, with bonds issued by Brazil’s beleaguered oil company Petrobras tightening between 2bp-5bp today amid light volumes.
News that it had clinched R$9.5bn (about US$3.11bn) in financing from Banco do Brasil, Caixa and Bradesco was lifting prices ahead of audited results expected out this week.
The company’s 2024s and 2044s were opening at around 469bp-461bp and 492bp-483bp, though some market participants doubt there is a tremendous amount of upside from here.
“We look further into the future and see no compelling reason to hold PETBRA other than for short-term trades,” Jorge Piedrahita, CEO of broker Torino Capital, wrote to clients this morning. “We would sell into strength.”
Elsewhere in Brazil’s corporate space, bonds from Odebrecht, one of several construction companies embroiled in the Petrobras corruption scandal, were off recent highs on some profit-taking but still well supported.
Its 7.125% 2042s were trading at 88.00, off a recent high of 91.50 but well above the 66.125 level seen in early February.
The 5.875% 2022s issued by Schahin Oil and Gas were stabilized in the low 40s Monday morning. Its parent company said Friday that 28 of its subsidiaries would seek bankruptcy.
Prices were propped up in part thanks to holders trying to garner a majority position in the bond, said one trader.
Elsewhere in the region, BBVA Colombia continues to hover around 100.80 after climbing about one point since pricing last week at 99.914.
Investors are keen to get their hands on quality credits in a market that has seen comparatively little supply this year.
Southern Copper announced initial price thoughts of Treasuries plus 240bp area on a 10-year and T+365bp area on a 30. Pricing is expected today through leads Credit Suisse and Morgan Stanley.
Banco de los Trabajadores (Bantrab) will hit the road next week to market a possible subordinated debt offering through Deutsche Bank.
The Guatemalan bank, which focuses on payroll-lending to public sector employees, is in Santiago today, Switzerland on April 22, New York on the 23rd and Miami on the 24th. The bank carries corporate ratings of Ba3/BB- by Moody’s and Fitch.
ACI Airport Sudamerica, controlling shareholder of the concessionaire of Uruguay’s Carrasco airport, mandated Bank of America Merrill Lynch and Nomura for investor meetings that concluded last week in London and Los Angeles.
A potential senior secured 144A/Reg S deal backed by future dividends from a long-term airport concession contract may follow.
Empresa Electrica Guacolda S.A. (Guacolda) has kicked off roadshows as it markets a senior unsecured 144A/Reg S USD bond. The borrower mandated Citigroup, GS and Itau as global coordinators, while Scotiabank is joint bookrunner.
The company is in Los Angeles today, and will head to New York on April 21 and Boston and New York on April 22. Guacolda is owned 50% plus 1 share by AES Gener (Baa3/BBB-/BBB-), while the remainder is held by infrastructure fund Global Infrastructure Partners. Expected ratings are BBB-/BBB-.
Pacific Rubiales, the largest private oil producer in Colombia, has kicked off investor meetings through Bank of America Merrill Lynch, Citigroup and HSBC. The company will head to Santiago on April 30, Los Angeles on May 4 and Miami on May 6. (Reporting by Paul Kilby; Editing by Marc Carnegie)