Brazil

Brazilian state-owned oil and gas giant Petrobras will issue a new long 10 year of over $4bn after existing bondholders agreed to participate in an exchange offer that will see them swap old notes for a combination of cash and new paper.

Brazilian oil giant Petrobras will continue to push out its debt maturities and reduce its outstanding stock of bonds with an exchange and tender offer that includes retiring existing notes using cash.

Clarity on the costs that Brazilian mining giant Vale will face as a result of a tragic accident at one of its dams in January has led Moody’s to remove the negative outlook from the company’s Ba1 rating.

To make a real difference, green finance needs to prove it is tough on dirty companies. How can the sector look at the fires ravaging the Amazon region and still take comfort in having embraced a bond issued to finance cattle purchases there?

Brazilian state-owned lender Banco do Brasil is offering bondholders a fee to bring the change-of-control clause in two of its old notes in line with the documentation in its newer bond issues.

Debt capital markets and syndicate bankers covering Latin America say they are enduring a busy week despite no new issuance as they expect a busier than usual September.

Brazilian protein producer JBS will continue its active liability management with the buy-back of $700m of bonds maturing in 2023 and 2024.

A senior secured bond from Brazilian MV24 Capital performed well on the break on Friday, shrugging off global market concerns, with new issuance from Latin America likely to be limited in the next few weeks.

International investors this week enthusiastically bought a $500m ‘sustainable transition bond’ issued by Marfrig, the second biggest Brazilian beef producer. The deal highlighted its efforts to make its supply chain more sustainable. But Greenpeace, the environmental NGO, argues it is impossible to be sure the supply chain does not include harmful practices.

Investors happily agreed to buy new senior secured debt from a Petrobras service provider at a healthy pick-up to the oil giant’s curve on Thursday, but a cancelled deal from Argentina suggested idyllic conditions for Lat Am issuers were slightly fading.

The latest idea captivating sustainable finance enthusiasts is transition bonds.

Marfrig Global Foods, the Brazilian beef producer, has stirred up the green finance market by issuing a $500m ‘sustainable transition bond’. To some, it is a template for a new asset class that can help finance the global economy’s shift to lower carbon emissions. To others, it is a shocking case of greenwashing. By Oliver West and Jon Hay.