Brazil's Euro Comeback
Brazil returns to the European bond market for the first time in two and a half years and finds strong demand among Europe's growing pool of institutional investors.
Brazil's economy is going from strength to strength. Moody's
and Standard & Poor's both upgraded Brazil in September.
But that has not translated into smooth access to the
international debt capital markets. Brazil has come to rely
more heavily on the dollar following Argentina's 2001 default
that decimated the European and Japanese retail markets, once
an important source of financing for Latin American sovereign
issuers. Yet dollar market investors have waxed and waned. So
Brazil looked across the Atlantic for support.
In September, Brazil sold a ?750 million eight-year bond
lead-managed by joint bookrunners UBS and Dresdner Kleinwort
Wasserstein. The Brazilians went to the market for ?500 million
but quickly clocked up ? 2 billion in orders from 260 accounts
in 21 countries. The buyers were Europe's burgeoning base of
institutional investors, who have taken the place of retail
investors devastated by Argentina. Demand was so...
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