Azerbaijan to place sovereign Eurobonds next week
Baku, Azerbaijan, March 6
By Emin Aliyev - Trend:
Azerbaijan plans to place sovereign Eurobonds to the amount of one billion euros next week, Reuters reported on March 5 citing one of the investors who participated in the negotiations with the Azerbaijani government as part of Eurobond road show started on March 3.
"The country with an investment credit rating intends to place an issue with the benchmark yield of 100 basis points to SOCAR's Eurobonds," the investor added.
On March 11, 2013, SOCAR placed Eurobonds to the amount of $1 billion for 10 years with a yield of 4.75 percent per annum on the CEEMEA market (Central and Eastern Europe, the Middle East, Africa). The demand for them is three times higher than the volume.
SOCAR's Eurobond debut issue to the amount of $500 million with a yield of 5.45 percent per annum was made in February 2012. The maturity date of the primary Eurobond issue was set at February 9, 2017.
"The yield on SOCAR's bonds with a maturity date in 2023 is 5.59 percent per annum," the agency said. "If the new issue of sovereign bonds is placed with the benchmark yield of 100 basis points, then Azerbaijan will trade on the narrower spreads than Russia having a higher ranking. Its bonds are listed proceeding from 230 basis points over swaps maturing in 2023."
The potential buyers are likely to require 'spread' from 240 to 250 basis points for Azerbaijan's debut Eurobond issue, the investor said.
Azerbaijan holds meetings with investors in Europe, Great Britain and the U.S.
Such investment banks as Barclays, Deutsche Bank AG London and Citigroup Global Markets Limited were chosen as managers of the government implementing the first issue of Eurobonds.
Azerbaijan has investment ratings of the leading international agencies - Fitch (BBB-), Moody's (Baa3) and Standard & Poor's (BBB-).
Translated by NH
Edited by CN