September 3, 2014 / 2:10 PM / in 3 years

UPDATE 3-Brazil sells $1 bln in reopened 10-year bond

(Updates with final pricing details)

BRASILIA, Sept 3 (Reuters) - Brazil on Wednesday sold $1 billion worth of a reopened global bond due in January 2025 , taking advantage of strong demand for Brazilian assets to reduce debt costs.

Appetite for Brazilian assets have been on the rise as opinion polls showed declining support for the re-election of President Dilma Rousseff, whose economic policies have been strongly criticized by investors. They are betting Brazil’s next president may adopt tighter fiscal policies that would boost the value of the country’s debt.

The 2025 bond, which carries a coupon of 4.25 percent, was priced at 103.05 to yield 3.888 percent, or 147 basis points above comparable U.S. Treasuries, the Treasury said. That was tighter than the initial price guidance of 160 basis points over Treasuries reported by Thomson Reuters’ IFR.

The Treasury initially planned to sell $500 million to $750 million of the 2025 bonds but increased the offering as demand for the bonds topped $4 billion, a government official with knowledge of the deal told Reuters.

The sale was managed by Morgan Stanley, Grupo BTG Pactual SA and Citigroup Inc. The bonds were sold in the European and U.S. markets, but an additional $50 million will be offered to Asian investors, the Treasury said.

In July, Brazil sold $3.55 billion in global bonds due in 2045, using part of those proceeds to buy back $2 billion worth of costlier global bonds with maturities that ranged from 2024 to 2041. (Reporting by Alonso Soto, writing by Walter Brandimarte; Editing by Chizu Nomiyama, Jeffrey Benkoe and Jonathan Oatis)

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