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Issuers rush to squeeze in bond deals

Dec 12, 2013

A pack of bond issuers led by Trinidad and Honduras stampeded into the market Wednesday, ahead of expected higher costs in 2014


This week might represent borrowers' last chance to sell bonds before investors break for the year - at least, several LatAm credits treated it that way Wednesday.

     
     
  ALL LIT UP: AES Gener was one of several
borrowers to tap the debt market Wednesday
Source: AES Gener
 


Issuers raised $2.25 billion in the cross-border market Wednesday, ahead of worries that borrowing costs will rise in 2014. The deals also came as emerging market debt funds last week registered their first inflows in months, providing another bit of encouragement.

Honduras found conditions sufficient to double its expected bond offering to $500 million and Trinidad and Tobago increased its first offering since 2007 to $550 million. Yet despite the welcome for this pair, Bahamas appears to be waiting to issue after meeting investors this month.

Chile's AES Gener brought out a 2073 non-call 5.5 year hybrid, to help with equity contributions to generation projects. Santander Mexico is roadshowing next week a $1 billion Basel III-compliant tier two bond that will be the first of its kind in Latin America.

Among high-yield borrowers, Mexico's Idesa made its international bond debut with a $300 million deal. Speculative-grade regular Digicel opted to add $500 million to its existing 2020 bonds. And ahead of what is to be YPF's second bond since last year's nationalization, Argentina's national oil company has drummed up serious interest on the road this week.

Cross-border issuers have raised $120.36 billion this year through Wednesday, according to Dealogic data. This is already ahead of the $116.84 billion for the full-year 2012.

Local first

Wednesday's biggest deal, however, came from a domestic market. Fibra Uno raised $654 million-equivalent in Mexico's local market. The deal was the first bond sale ever from one of the country's fibras - real estate funds - as well as the largest sale from a non-government borrower this year. It was joined in the local market by a guaranteed sale from CFE.

Not to be outdone, Colombia's Celsia tapped the domestic market for $413 million-equivalent. LF



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