Bloomberg News

El Salvador to Join America Movil, Cencosud Selling Debt Abroad

November 28, 2012

El Salvador plans to sell dollar bonds in a benchmark offering as emerging-market issuers from America Movil SAB in Mexico to Chile’s Cencosud SA (CENCOSUD) take advantage of borrowing costs hovering near a record low.

The Central American country hired Citigroup Inc. and Deutsche Bank AG to sell the debt, according to a person familiar with the matter who asked not to be identified because terms aren’t set. A benchmark offering is typically at least $500 million.

Near-zero benchmark interest rates in Europe and the U.S. are boosting demand for emerging-market assets with higher returns. The average yield on debt from developing nations was 4.62 percent yesterday after reaching a record low 4.59 percent on Oct. 16, according to JPMorgan Chase & Co.’s EMBI index.

America Movil, the biggest mobile-phone carrier in the Americas by subscribers, is selling 10-year peso bonds overseas in a benchmark offering, according to a person familiar with the transaction who asked not to be identified because terms aren’t set. Deutsche Bank AG, HSBC Holdings Plc and Morgan Stanley are arranging today’s transaction.

Cencosud, a retailer controlled by billionaire Horst Paulmann, plans to issue $1 billion of 10-year bonds as soon as tomorrow, according to a person familiar with the transaction who asked not to be identified because terms aren’t set

CFR Pharmaceuticals, Chile’s largest drug developer, plans to sell $300 million of 10-year securities callable after 10 years, according to a person familiar with the offering.

Grupo KUO SAB (KUOB), a Mexican industrial conglomerate, plans to sell 10-year bonds to yield about 6.5 percent, according to a person familiar with the transaction who asked not to be identified because terms aren’t set.

Mongolia, Rosneft

Mongolia may sell five- and 10-year bonds in a debut offering after meeting with investors, according to a person familiar with the discussions who asked not to be identified because details are private.

Rosneft, Russia’s biggest oil company, plans to offer as much as $3 billion of bonds due in five and 10 years, according to Aaron Grehan, a fund manager at Aviva Investors who attended an investor meeting yesterday.

Tinkoff Credit Systems, the Russian consumer lender part- owned by Goldman Sachs Group Inc., may sell as much as $100 million of subordinated bonds due in 5.5 years, according to President Oliver Hughes. Goldman Sachs and JPMorgan Chase & Co. are arranging meetings with bond investors in the U.K. and Switzerland, he said.

To contact the reporter on this story: Veronica Navarro Espinosa in New York at vespinosa@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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