SINGAPORE: China National Petroleum Corp last night raised $1.85bn through a three-tranche bond that under-whelmed in size and came in at slightly above half the $3bn that the market was expecting all along. The Reg S/144a offering was split into a $700m 5-year tranche, a $650m 10-year piece and a $500m 30-year portion that met with overall demand of $5.9bn.
Citigroup, ICBC International and Standard Chartered were joint global coordinators and joint book-runners along with Bank of America Merrill Lynch, BOC International, Deutsche Bank and HSBC.
Surprisingly, it was the 30-year tranche that met with overwhelming demand of $2.7bn from 162 accounts. In comparison, the 5-year piece drew in orders of $1.5bn from 100 investors, while the 10-year portion saw a book of $1.7bn from 115 accounts.
The $700m 5-year tranche priced at 98.968 and a coupon of 3.125pc to yield 3.351pc, while the $650m 10-year piece priced at 97.717 and a coupon of 4.50pc to yield 4.79pc. The $500m 30-year portion priced at 97.812 and a coupon of 5.95pc for a yield of 6.11pc.
The pricing represented spreads of 123bp, 138bp and 163bp respectively over the comparable US Treasuries. The pricing came at the tight ends of final guidance of 123bp-125bp for the 5-year, 138bp-140bp over for the 10-year and 163bp-165bp over for the 30-year released yesterday afternoon in Asian hours.
Final guidance had been refined from earlier initial guidance (released on April 18) of 120bp-125bp, 140bp area and 165bp area for the respective tranches.
In the aftermarket, the 30-year bond has traded in significantly by as much as 25bp this morning to 139bp over, while the 5- and 10-year tranches traded 5bp-7bp tighter.
In terms of distribution, Asia accounted for 76pc, 51pc and 25pc respectively of the 5-, 10- and 30-year tranches, with Europe taking 8pc, 13pc and 25pc. US investors came in for 16pc, 36pc and 50pc respectively of the 5-, 10- and 30-year tranches.
By investor type, the 5-year tranche saw funds taking 25pc, banks 55pc, official institutions 16pc, insurers 3pc and others 2pc. The 10-year portion had funds coming in for 45pc, banks 35pc, official institutions 13pc, insurers 3pc and others 4pc. Funds piled into the 30-year taking more than 3/4ths of the tranche at 76pc, while banks (6pc), insurers and official institutions (7pc each) and others (4pc) took the remainder.
The transaction settles on April 28. It is rated A1/A+/A+, while CNPC has a Aa3/AA- (Moody's/S&P) rating.
Century Tokyo Leasing Corp has raised CNY200m ($31m) from a 3-year renminbi-denominated and settled bond. Mizhuo and UBS were the joint bookrunners on the Dim Sum bond, which priced at 2.70pc, closer to the wide end of the 2.50pc-2.75pc guidance released yesterday.
The unrated Reg S offering settles on April 28. Proceeds will be used to on-lend to the borrower's subsidiary in China.
Agricultural Development Bank of China today auctioned CNY15bn ($2.3bn) of 2-year fixed-rate finance bonds at 3.65pc. The deal was 1.76 times covered. The pricing came inside of outstanding 2-year policy bank paper which was quoted at 3.7077pc in the secondary market. The bonds will settle on April 27. The bond will have a greenshoe option of up to CNY10bn. Fees are 5bp. This is the 8th tap from ADBC in the current year. The bank last sold CNY25bn of 5-year paper at 4.04pc on April 8.
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