South America

Investors saw Brazilian pulp and paper company Fibria Celulose’s new 10 year green bond pricing very tight to its existing curve, despite the company having to remove controversial covenant language after it proved unpopular with investors.

Four private sector corporates from Latin America sold dollar denominated bonds this week, although borrower-friendly market conditions were not enough to allow the issuers to get away with more aggressive covenant language.

Both of Petrobras’ new benchmark bonds traded up more than a point the day after pricing as bankers said the level of demand for the deal would have allowed the company to print even more than the $4bn it managed on Monday.

Bond bankers were struggling to remember a time when a single-B credit had provided the first LatAm deal of the year, but Petrobras’ new issue succeeded in blowing the market wide open as borrowers line up to raise funding.

BRF, the Brazilian food conglomerate, has confirmed that it is considering London for an IPO of its halal food business, although a final decision has not been made.

Petrobras has opened books on the first non-Asian emerging markets bond of the year, and is marketing a four-tranche dollar bond.

Fast growing Argentine energy company Pampa Energía will begin investor meetings on Tuesday as it plans a much anticipated debut bond sale to refinance loans used to purchase Petrobras’ Argentine operations last year.

Venezuela’s surprise issuance of $5bn of 20 year bonds in a private placement sold this week to state-owned Banco de Venezuela had no obvious explanation, said bond market participants.

Pulp and paper producer Fibria Celulose is looking to become the second Brazilian company in the sector to issue green bonds after mandating five banks to manage an investor roadshow.

Power generation company Genneia looks set to become the first Argentine company to debut in bond markets this year as DCM bankers predict a slew of new corporate issuers from the country in 2017.

Brazilian corporates Fibria Celulose and Raizen are looking to sell dollar bonds this month as bankers say issuances volumes from Latin America’s largest economy will continue to recover in 2017.

Cash strapped Venezuela has issued $5bn of 20 year bonds in a private placement sold to state-owned Banco de Venezuela and the central bank.