Orders for Petrobras six-part dollar bond reach USD12bn -sources

Mon Mar 10, 2014 9:55am EDT

NEW YORK, March 10 (IFR) - Orders for the six-part dollar bond offering from state-controlled Brazilian oil company Petrobras have reached USD12bn, according to market sources.

News of the deal on Monday sent Brazilian corporate bond spreads wider ahead of what is expected to be a jumbo deal, and potentially a record size issue, for the company.

Petrobras' bond spreads also widened by about 15bp across the curve in response to the offering, comprising of three-year fixed and floating rate bonds, a six-year floater and fixed, as well as fixed-rated 10- and 30-year tranches.

Initial price thoughts have been set at Treasuries plus 260bp, 3-month Libor plus 246bp, Treasuries plus 340bp, 3-month Libor plus 298bp, Treasuries plus 360bp and Treasuries plus 370bp, respectively, by leads HSBC, JP Morgan, Citi, Bank of China, BB Securities and BBI.

The senior secured SEC-registered notes are expected to be rated Baa1 by Moody's and BBB by S&P and Fitch. All three have negative outlooks.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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