COUNTRY REPORT JAPAN“It was a rare deal with a good credit and
attractive pricing,” one of the sources said.
Signing took place on August 21.
In March, Trafigura Beheer BV raised a
¥72.64bn three-year Samurai loan, which
is the largest such loan this year. MUFG,
Mizuho, and SMBC were bookrunners
and mandated lead arrangers on the loan,
which was Trafigura’s fourth syndicated
loan in Japan.
Vitol, a frequent borrower in loan
markets, last tapped a Samurai financing
in July 2013 when it completed a ¥31.5bn
three-year loan.
In July this year, it completed a
US$1.855bn 364-day revolving credit,
which paid a top-level all-in pricing of
70bp based on an interest margin of 55bp
over Libor. OCBC Bank is the facility
agent of the self-arranged deal, which
attracted 19 lenders.
› OLAM SIGNS INCREASED ¥30BN SAMURAIOLAM INTERNATIONAL signed a ¥30bn Samurai
loan last Wednesday, sources said,
becoming the second commodity borrower
to tap the Japanese loan market in the past
month.
Around 10 lenders, including regional
banks, joined in syndication, leading to an
oversubscription and increase in the deal
size from an original ¥22.5bn target.
Mizuho Bank and MUFG arranged the
facility, which is split into three and five-
year tranches.
The interest margin on the three-year
portion is in line with Olam’s debut
Samurai loan in July last year. That three-
year loan pays a margin of 45bp over yen
Libor. The facility was increased from
the ¥15bn target to ¥25bn after several
Japanese regional banks joined. MUFGand Mizuho Bank were the mandated lead
arrangers and bookrunners.
Olam is the guarantor on the latest
Samurai and its wholly owned subsidiary,
Olam Treasury is the borrower.
Last month, Vitol wrapped up a ¥60.8bn
borrowing, returning after five years for a
Samurai loan.
In March, Olam raised a US$500m
three-year sustainability-linked revolving
credit facility, the first loan in Asia to tie
the interest margin to the borrower’s
performance on environmental, social and
governance metrics.
Headquartered in Singapore and listed
on the country’s stock exchange in 2005,
Olam is an agri-business company with
operations in 70 countries.› FPG TO RENEW COMMITMENT LINESFINANCIAL PRODUCTS GROUP is set to sign four
commitment lines totalling ¥32.3bn to
partially renew its existing facilities, the
Tokyo Stock Exchange-listed financial
services firm said last Thursday.
Sumitomo Mitsui Banking Corp is the
arranger and agent on a ¥15.5bn one-year
facility that will replace a ¥19.1bn one-year
deal. Sumitomo Mitsui Trust Bank came in as
co-arranger, while Aeon Bank, Kiraboshi Bank,
Mie Bank, Senshu Ikeda Bank, Shoko Chukin
Bank, Tsukuba Bank joined in syndication.
The signing is scheduled for September 25.
Mizuho Bank is the arranger and agent
on a ¥10bn one-year facility that will
replace a ¥13bn one-year deal. The
drawdown of ¥7bn-equivalent of the
facility can be in US dollars or yen, while
the remainder can only be drawn in yen.
Ashikaga Bank, Fukuho Bank, Gunma Bank,
Hiroshima Bank, Hokuetsu Bank, Keiyo Bank,
Shinsei Bank, Shizuoka Bank and Tokushima
Bank joined in syndication. The signing is
slated for September 25.
Chiba Bank is the arranger and agent on
a ¥2.8bn one-year facility that will renew
a same-sized one-year borrowing. Aomori
Bank, Chugoku Bank, 77 Bank and Toho Bank
joined in syndication. The signing is
scheduled for September 28.
Bank of Yokohama is the arranger and
agent on a ¥4bn one-year facility that will
renew a same-sized one-year deal. Higashi-
Nippon Bank, Hokuriku Bank, Saga Bank and
Yamaguchi Bank joined in syndication. The
signing is slated for September 26.
The loans have two financial covenants:
the borrower must maintain a minimum of
75% in net assets and should not have any
recurring losses.
The funds are for FPG’s tax leasing
arrangement business.
In March, the borrower renewed two
commitment lines totalling ¥24.3bn.Japan Inc turns to euros
Bonds Japanese issuers find strong investor reception in EuropeJapan’s NIDEC, rated A3 by Moody’s, put in a
strong showing on its debut in the euro bond
market, a day after compatriots TOYOTA and
JAPAN TOBACCO also impressed. (See News.)
Investors poured into Nidec’s €300m
(US$353m) deal, placing over €1.9bn of
orders. The bond printed at 45bp over
mid-swaps - 20bp tighter than initial price
thoughts.
The company, a maker of small precision
motors, has various European operations,
including a joint venture with PSA. It will be
using the proceeds from the bond to fund
those operations, a banker on the trade told
IFR prior to the deal.
Morgan Stanley, Citigroup, HSBC and JP
Morgan managed the deal.
The euro corporate market has recently
seen a rush of debut trades as issuers rush to
lock in low yields while the European Central
Bank is still buying.
“Issuers that have European exposure are
figuring out this is an attractive point to lock
in those yields,” a banker said. “Other issuers
are valuing to some degree the diversification
offered by a European investor base.”
A day earlier, Toyota revved up with an
inaugural benchmark euro transaction from
its Netherlands funding unit on Wednesday.
The Japanese automaker, rated Aa3/
AA– (Moody’s/S&P), plans to become a
more regular issuer in the capital markets
via its Dutch finance arm, according to a lead
manager.
To that end, it chose a five-year maturity toappeal to the broadest possible investor base
and create a solid reference point for future
deals, he said.
The tactic paid off: investors placed
over €2bn of orders for the bond, which
launched at mid-swaps plus 33bp – some
17bp inside the tight end of the 50bp-55bp
IPTs.
The order book allowed Toyota to upsize
from an initially telegraphed €500m to
launch at €600m.
“The deal gave investors a great
opportunity to diversify into a high-quality,
low-beta name,” the lead said.
Investors are snapping up bonds which
have scarcity value - although trades from
already well-established businesses are
preferred, bankers said.
Toyota has been testing the waters in
different markets via its finance units this
year. Toyota Finance Australia sold a debut
sterling bond in July, three months after the
unit made its euro debut.
The company has traditionally issued
bonds in the euro market via its US entity
Toyota Motor Credit Corp.
Leads referenced TMCC, Honda and BMW
as comparables, with fair value put at around
25bp.
The deal will likely be eligible with the
ECB under the Corporate Sector Purchase
Programme, a second lead said.
BNP Paribas, HSBC, ING and UniCredit were
bookrunners.
ELEANOR DUNCAN