South America

Sovereign issuers may have grabbed the headlines in Lat Am bonds on Wednesday, but the operator of Santiago’s metro system was certainly able to attract enough investor attention as it raised $500m of funding on Wednesday.

Argentina had attracted nearly $15bn of orders for its latest dollar issuance by Wednesday’s close, as both investors and bankers following the deal said they thought the sovereign may issue more than the $5bn it initially planned to sell.

Two Latin American sovereigns priced dollar deals on Wednesday in what some were interpreting as a rush to beat possible volatility surrounding Donald Trump’s inauguration as US president on Friday. But if markets are worried about what’s round the corner, they’re yet to show it.

Sovereign issuers may have grabbed the headlines in Lat Am bonds on Wednesday, but the operator of Santiago’s metro system was certainly able to attract enough investor attention as it raised $500m of funding on Wednesday.

Argentine energy company Pampa Energía clinched pricing that was “very competitive” versus peers on its debut bond issue, said EM syndicate bankers, as borrower-friendly conditions showed no sign of fading ahead of Argentina’s crucial sovereign bond issue on Thursday.

All seven new issues to emerge from Latin America last week ended Friday above their respective reoffer prices to reiterate the favourable conditions available to the region’s borrowers.

Tecnoglass, the Colombian window manufacturer, may sell dollar bonds this week just two months after it postponed its initial issuance plans after Donald Trump’s US election victory.

Argentina could not wish for better market conditions as it prepares its crucial first bond of 2017, said Lat Am bankers this week. After many sleepless nights for DCM bankers pitching the deal, the South American sovereign on Wednesday mandated bookrunners, writes Oliver West.

Brazilian state-owned oil company Petrobras cemented its popularity as an improving credit story with a hugely oversubscribed $4bn new issue that flew above par in secondary markets, triggering a great week for Lat Am new issues and reiterating the renewed optimism around Latin America’s largest economy.

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.