Petrobras breaks drought in LatAm market

Brazil's Petrobras opened the Latin American primary markets on Monday with the region's first cross-border bond sale of the year. Petrobras is approaching investors with five and 10-year bonds to finance an up to US $2bn tender as part of the debt-laden company's efforts to term out upcoming maturities. At initial price thoughts of 6.5% area on the five-year and 7.75% area on the 10, bankers are calculating starting new issue premiums at anywhere between 50bp and 75bp.
That calculation depends in part on how much weight to give the high dollar price on the existing 8.375% 2021s and 8.75% 2026s, which according to one banker were trading last week around 109 and 110.50, or yields of 5.95% and 7.18%.