New issues in emerging markets lag; Dubai prices $1.25 billion; Cnooc eyes $2 billion deal

By Aleesia Forni

Columbus, Ohio, April 25 - The collective mood in emerging markets is one of adding risk, according to one market source, though recent issues seem to be lagging in the secondary market.

The source cited the new deals from Promsvyazbank, Nomos Bank and OAO Raspadskaya, which all traded near their respective reoffer prices during London's session.

The primary market saw Dubai price $1.25 billion of sukuk in two tranches on Wednesday, according to a syndicate source.

The $600 million of 4.9% five-year sukuk priced at par, whereas guidance was set at 5%.

A $650 million tranche of 6.45% 10-year paper sold at par, tightened from earlier guidance of 6½%.

Citigroup, HSBC, National Bank of Abu Dhabi and Dubai Islamic Bank were the bookrunners.

The new bonds traded up ¼ point in the grey market during London's session, a source there said.

"Activity in the Dubai secondary curve has been muted, aside from small selling in Dubai notes maturing in 2014 and 2020, which bodes well for the new deal," the source added.

Proceeds will be used to meet budget deficits.

The Markit iTraxx SovX CEEMEA index, which tracks Central and Eastern Europe, the Middle East and Africa credit default swaps, traded at 288 basis points during the Wednesday London session, 5 bps tighter than Tuesday's close.

Cnooc new issue

Also in the primary, Cnooc Ltd. sold $2 billion of bonds in 10- and 30-year tranches, according to a market source.

The Hong Kong-based oil and gas exploration and production company priced $1.5 billion of 3 7/8% notes due 2022 at Treasuries plus 190 bps.

A $500 million issue of 5% 30-year bonds also priced at Treasuries plus 190 bps.

Barclays, BOC International and Citigroup are joint lead managers and joint bookrunners.

Proceeds from the Rule 144A and Regulation S transaction will be used for general corporate purposes.

Shanghai Prime offer

Also on Wednesday, Shanghai Prime Machinery Co. Ltd. announced it plans to issue up to RMB 1 billion of guaranteed bonds in China.

The bonds would be offered in one or more tranches with maturities of no more than 10 years, and proceeds would be used to repay bank loans and for general working capital purposes.

The fastener manufacturer and exporter is based in Shanghai.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.