Oil Sector leads DCM to expected busy September
August 30, 2013
With several transactions ready to go, bond issuers hope volatility has calmed down
With the June and July US Treasury market hysteria behind,
Latin American issuers are prepared to take advantage of relative calm to raise
funds. Two in the oil and gas sector have already announced plans.
Colombia’s Ecopetrol will meet
investors during the first week of September ahead of what could be the
state-controlled firm’s second-ever international bond issuance. The deal would follow a
Mexico’s Grupo R is poised to capture increasing interest in
Mexico’s energy sector. With laws being discussed to give state-owned Pemex
more flexibility, market watchers sniff opportunity to use the bond market to
the extent that Petrobras contractors have in Brazil. Offshore Drilling
Holdings, Grupo R’s parent, is
meeting investors ahead of a likely $955m bond.
Like Ecopetrol, Chile’s Embotelladoras Andina is targeting
both domestic and cross-border funds to help replace acquisition debt. It
could be joined by any of several issuers who decided to wait earlier in the
year, including fellow Chileans Telefónica
Móviles Chile and Colbun. The City of Lima was another meeting investors in August and who is likely to return.
Brazilian bank Caixa is looking
to return to the DCM. Guatemala’s Cementos
Progresso is a candidate to make its cross-border debut.
On the sovereign side, Barbados has indicated
interest in raising $250 million.
Despite a closing of the cross-border markets earlier this
year when widening treasury levels spooked issuers, volume is up in 2013. LatAm
issuers have sold $99.2 billion from 268 transactions through August 29,
according to Dealogic, when both domestic and cross-border issuance is
considered. This compares to $97.9 billion from 261 deals in the corresponding
period in 2012. LF