Grupo de Inversiones Suramericana’s $300 million bond priced a 5.7% coupon at 99.354 to yield 5.786% (US treasuries plus 260 basis points) on the back of $4.7 billion of demand last month.
Suramericana was the first Colombian corporate to access the international bond markets after the sovereign’s lift to investment-grade status. In a region that is becoming accustomed to blow-out deals it still managed to get attention.
The deal achieved an oversubscribed order book within an hour of announcing terms. Such was the level of demand, which reached $5.2 billion, that the issuer was able to tighten pricing from early whispers of treasuries plus 300bp, through guidance of 275bp to 286bp, and revised guidance of 265bp before pricing one day earlier than planned at 260bp.
Diversification play
Suramericana has holdings in some of the largest financial institutions and conglomerates in Colombia, including Bancolombia. "The issuer is a play for the country as a whole and so attracted a lot of investors looking for diversification into Colombia credit," says a banker who worked on the deal. More than 300 funds placed orders for the paper, including a healthy mix of high-grade and emerging market accounts.
