South America

Brazilian issuers continue to focus mostly on liability management rather than new debt raising as a combination of weak conditions and looming presidential elections makes timing new deals difficult.

Brazilian utility Cemig ended a three week hiatus in offshore Latin American bond issuance this week and was swiftly followed by the Dominican Republic as the two high yield borrowers raised a combined $1.8bn.

Chilean utility AES Gener will buy back $200m of old bonds after investors pledged to sell more than the maximum purchase amount that the company had set before the early bird deadline of July 11.

Dutch lender ING has hired a director to focus on Latin American and high yield debt capital markets origination as part of its recently launched global capital markets Americas group.

Brazilian utility Cemig will test appetite for high yield issuance in Latin America on Thursday after it approached investors about the possibility of tapping of its existing dollar bond.

Gas Natural de Lima y Callao, the largest gas distribution company in Peru, has received its second rating upgrade of the year after Moody’s pushed the borrower up by one notch to Baa2.

Faro Energy, which develops solar energy projects in Brazil and Colombia, has sold a green bond to finance distributed solar power projects, said the Climate Bonds Initiative (CBI).

Though market tone has shown a marked improvement over the last week, Lat Am bond buyers say that they are not expecting to see much new supply until September — and nor do they want any.

Colombian utility Empresas Públicas de Medellín (EPM) saw its bond prices slide at the end of last week after the environmental licencing authority issued a resolution appearing to suspend certain activities at the landmark Ituango hydroelectric project.

A group of investors owning bonds of Venezuela and state-owned oil company PDVSA want creditors of the two issuers to be treated equally.

Chile interrupted the quiet in Latin American bond issue markets on Thursday when it proceeded with a dual tranche peso deal, immediately after wrapping up a roadshow.

AES Gener, the Chilean utility, wants to buy back up to $200m of bonds using cash in hand, it said on Wednesday, as its commitment to reducing leverage looks set to save its investment grade rating.