IFR International - 20.10.2018

President Muhammadu Buhari, who will
seek a second term in a presidential election
in February, signed into law a record N9.12trn
53BN ûBUDGETûFORûûINû*UNEûASûPARTûOFû
an attempt to foster economic growth.
Lawmakers also approved debt issuance
OFû53MûTOûRElNANCEûTHEûBALANCEûOFûAû
53MûMATUREDû%UROBOND
.IGERIANûGOVERNMENTûOFlCIALSûHAVEûMETû
fund managers on a non-deal roadshow in
New York held to update bondholders on
the country’s growth plan following the
recession.

RUSSIA

O1 PROPERTIES KEEPS THE PLATES
SPINNING

O1 PROPERTIES has extended a consent
solicitation for a second time as the
company remains locked in discussions
with holders of its 2021 notes.
The real estate company has been
attempting to remove change of control
RESTRICTIONSûONûITSû53MûûSû
and had already been obliged to extend the
consent solicitation into October.
O1 Properties has now pushed the
expiration date back once more, this time to
.OVEMBERû
Riverstretch Trading & Investments
ACQUIREDûAûMAJORûSTAKEûINû/û0ROPERTIESûINû
ULYûCONSTITUTINGûAûCHANGEûOFûCONTROLû$UEûTOû
the existing bond provisions, O1 Properties
is obliged to offer to repurchase the notes.
O1 Properties said it may not have
SUFlCIENTûFUNDSûTOûREPURCHASEûTHEûNOTESûANDû
therefore offered to pay a consent fee to,
among other proposals, disapply the clause
obliging it to buy back the bonds, according
to a company statement.
Sberbank CIB is the solicitation agent for
O1 Properties.
Petrochemicals company SIBUR is set to
close a more straightforward liability
management exercise, having accepted a
TOUCHûOVERû53MûOFûITSû53Mûû
notes due 2023 for purchase.
4HEûMAJORITYûOFûTHEûTENDEREDûNOTESûCAMEû
from Russian holders, the company said in a
statement. Sibur used excess liquidity to
lNANCEûTHEûTRANSACTION
USTûUNDERû53MûOFûTHEûPURCHASEDûNOTESû
will be cancelled, while the remainder will
be held by Sibur for its own account, and
may be sold or cancelled in the future.
“Since Sibur was looking to buy back up
to US$200m of the paper, this means that it
MANAGEDûTOûBUYûBACKûûOFûTHEûPLANNEDû
amount, which is attributable to the
generous premium offered (more than
3pts),” wrote Alexander Sychev, analyst at
Sberbank.

“The dominance of local investors is an

interesting fact, albeit not a big surprise,

given that the buyback period was short and

US holders could not participate for

technical reasons.”

Citigroup and JP Morgan were dealer

managers.

TUNISIA

SOVEREIGN COMES AFTER MOODY’S

TURNS NEGATIVE

TUNISIAûANNOUNCEDûAûlVE

YEARûEUROûMANDATEû

on Thursday despite Moody’s putting the

SOVEREIGNûONûNEGATIVEûOUTLOOKûJUSTûTWOûDAYSû

before.

“I guess they were waiting for that to get

out of the way and announce,” said one

banker away from the deal about the timing

of the mandate.

Tunisia is rated B2 by Moody’s and B+ by

Fitch. Fitch already had the sovereign on

negative outlook, and Moody’s followed suit on

/CTOBERûûBYûMOVINGûTOûNEGATIVEûFROMûSTABLE

h$ESPITEûMEANINGFULûPROGRESSûONûlSCALû

and macroeconomic reforms in recent

QUARTERSû4UNISIAûlNDSûITSELFûEXPERIENCINGû

intensifying pressures in an increasingly

adverse external environment with

diminishing buffers to sustain resilience,”

said Moody’s analysts.

Moody’s said Tunisia could return to a

stable outlook should a combination of

continued reforms under the IMF

PROGRAMMEûAûRESTORATIONûOFûlSCALûANDû

external buffers and international

COMMUNITYûCOMMITMENTûSIGNIlCANTLYû

alleviate external liquidity pressures.

“Moody’s estimates external liabilities

maturing over the following year (plus

foreign currency long-term deposits) to

AMOUNTûTOûOVERûûOFûFOREIGNûEXCHANGEû

RESERVESûBYûTHEûENDûOFûûFROMûûINû

2018,” said Moody’s analysts, noting that

Tunisia’s level of reserves coverage is much

lower than for most Single B rated

sovereigns.

“Tunisia’s net international liability

POSITIONûATû

ûOFû'$0ûINûûISûALSOû

SIGNIlCANTLYûLARGERûTHANûTHOSEûOFûMOSTû

[Single B] sovereigns, denoting sensitivity to

delays in the availability or higher cost of

external funding.”

4UNISIAûPRINTEDûANûõMûSEVEN

YEARûDEALû

ATûAûYIELDûOFûûINû&EBRUARYûû

Although in the intervening period it has

hinted at issuing in both euros and US

DOLLARSûTHISûWOULDûBEûTHEûlRSTûINTERNATIONALû

bond since the trade around 18 months ago.

4HEûSûAREûBIDûATûûTOûYIELDû

ûACCORDINGûTOû4RADEWEB

The sovereign will hold two days of

meetings, starting on Monday.

Citigroup, Deutsche Bank, JP Morgan and

Natixis are lead managers.

REGIONAL

PROCREDIT PULLS UP SHORT

PROCREDIT HOLDING abandoned a debut Green

bond offering after putting out initial price

thoughts, saying investors needed more

time to get to grips with the credit.

The issuer, which lends to SMEs in

southeastern and eastern Europe, had held

four days of investor meetings earlier in

October.

It went out on Wednesday marketing a

THREE

YEARûSUB

BENCHMARKûBONDûATûBPû

area over mid-swaps but the going proved

tough. An announcement later went out

saying ProCredit would give investors

additional time, and work with accounts to

ensure lines are in place before returning to

the market.

The proposed instrument had an expected

BBB rating from Fitch.

Deutsche Bank and ING were bookrunners.

CPI DIVERSIFIES INTO SWISS

CPI PROPERTYûSUCCESSFULLYûDIVERSIlEDûITSû

investor base with its debut Swiss franc bond

following a Zurich and Geneva roadshow.

4HEûSENIORûUNSECUREDûlVE

YEARû

transaction opened books on Thursday for a

MINIMUMû3&RMûATûMID

SWAPSûPLUSûBPû

AREAûBEFOREûPRICINGû3&RMûINûLINEûWITHû

guidance.

!TûTHEûûCOUPONûANDûYIELDûPRICEDûATû

par, the bond came at Swiss government

BONDSûPLUSûBPû7ITHûûACCOUNTSû

taking part, the average ticket was a fairly

granular SFr3.17m.

That investor group was made up of

MAINLYûASSETûMANAGERSûWITHûJUSTûOVERûTWO

thirds of the paper, with private banks and

insurers making up most of the remainder.

“[The company] wants to diversify its base

of investors and access reliable sources of

liquidity when possible, and when we have

a good use of proceeds (in this case,

RElNANCINGûSECUREDûANDûSUBSIDIARYûDEBT  û

We have an investment in Switzerland, and

therefore it’s natural for us to develop a

long-term relationship with the Swiss

MARKETvûSAIDû#0)ûCHIEFûlNANCIALûOFlCERû

David Greenbaum.

4HEûDEALûCOMESûAFTERûAûõMû!PRILûû

OFFERINGûATûBPûOVERûMID

SWAPSûTHEû

previous week.

CPI owns income-generating real estate in

the Czech Republic, Berlin and the CEE

region. The bonds were rated Baa2 (stable)

by Moody’s and BBB (stable) by S&P.

Credit Suisse and Deutsche Bank led the deal.