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Single-B credits target debt market

Nov 7, 2013

Investor appetite for high-yield deals this year is encouraging lower-rated borrowers to come to the bond market

Mexican miner Cobre del Mayo (CDM) was due to price a $225 million 5-year bond later Thursday. The deal represents a debut for the B3/B debut credit, and would be part of a steady stream of high-yield issuance that is now reaching into single B territory.

Also, Peru's Andino Investment Holding (AIH) was expected to price a transaction of more than $130 million as soon as this afternoon. The B+/BB minus trade and transportation holdco is looking to follow a sale through its Terminales Portuarios Euroandinos unit done last year.

Brazil's CBC Ammo also is targeting a bond, as soon as Friday. The issuer, an small-caliber ammunition maker with global sales, is hoping to lure buyers to a 2021 bond of up to $250 million.

The transactions will look to build off of the momentum of Latam's $450 million ticket and cargo revenue securitization and a $150 million debut from Guatemalan Banco de los Trabajadores done earlier this week in the double-B space.

In the double-B space, sugar exporter Ingenio Magdalena plans to bring out $400 million bond, another debut, as soon as this week. Investment-grade issuers on tap included Mexico's Fresnillo, as soon as today, and Coca-Cola Femsa.

Single B issuance is ahead of 2012's pace, according to Dealogic data. Issuer's have sold $11.61 billion in 31 transactions this year through Wednesday, up from $7.92 billion from 20 in the corresponding period in 2012. This year's single B total comes out of a $20.60 billion high yield volume and overall cross-border DCM volume of $109.70 billion. LF


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