AES Gener builds bond on solid demand

AES Gener builds bond on solid demand

Bonds Debt Capital Markets Corporate & Sovereign Strategy Fixed Income Chile

Chile's AES Gener increased the size of a 60-year bond sale to $550m after receiving more than $2.2bn in orders, LatinFinance has heard.

The heavy demand also allowed the power company to tighten the yield to 7.125% after the bookrunners put the initial price talk in the high 7% area, said a debt capital markets banker in Santiago.

The bookrunners Bank of America, Goldman Sachs and JPMorgan priced the bonds at 99.948 with a coupon of 7.18% to yield 7.125%, the banker said.

"This was a very good deal for the company, but I don't expect it to set a standard," the banker said. "This is a very good business with a reliable structure, and there aren't that many like that in Chile."

AES Gener had planned to sell $500m in new 60-year notes to fund the buyback of $50m in 2073 notes.

Several commercial banks and specialist energy investors placed orders for the new notes, which allowed AES Gener to lower the average yield from the 8.375% it pays on the old notes, the banker said.

The banker also said that it expects a "high percentage of current holders" to participate in the buyback, with the early deadline on March 22.

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