Transelec keeps bond pipeline open
July 24, 2013
A deal from Transelec has shown the cross-border bond market remains open for investment-grade credits. Mexico and Bermuda are set to keep the pipeline going.
The opening in the DCM that started earlier this month is
widening somewhat, with corporates now coming through, and more transactions on
Chile’s Transelec sold
its first dollar-denominated bond in 12 years Tuesday. The electric
transmission operator sold $300 million in 2023 bonds, upsizing from an
expected $250 million. The deal follows América
Móvil and Banco
do Brasil in opening the markets for corporate issuers.
Government-guaranteed sales have also provided access to
funds, particularly from US high-grade investors. Mexico’s Aeroméxico
sold $117 million in bonds guaranteed by the US Ex-Im bank, to fund an
Meanwhile, sovereigns are getting into the act as well, with
expected to price Yen-denominated bonds as soon as next week, in what has
become a regular visit to the so-called Samurai market.
“This transaction has various objectives. One is a [regular]
presence in the Japanese market and second to issue at more attractive levels
in the 3 and 5-year space,” Mexico’s public credit head Alejandro Díaz de León
Bermuda is on
the road this week ahead of a dollar bond sale. If conditions are to its
liking, the sovereign should sell a new bond next week. The island’s government
is raising funds to head off a fiscal deficit expected to be 6% of GDP.
It still remains to test access for high-yield issuers, who
have not sold a non-Ex Im-guaranteed cross-border bond since May . With the
August vacation period approaching, market watchers don’t expect any more until