Peru

Cerro del Aguila, the Peruvian power generator, began investor meetings on Wednesday ahead of a planned international bond debut that will conclude with the merger of the borrower and existing bond issuer Kallpa Generación.

Aluminum Corporation of China (Chinalco) has approached lenders for a $200m two year loan through its Peruvian arm, according to bankers.

South American sovereign Peru said it is unlikely to return to global depositary notes (GDNs) as a way of attracting international buyers into its local curve after selling its first ever Euroclearable Nuevo sol-denominated bond on Monday.

Peru’s first ever Euroclearable nuevo sol-denominated bond was bid tighter on Tuesday as the country’s director of financial markets management said he hoped the deal opened doors for the private sector to carry out similar trades.

Peru’s efforts to make its domestic bond curve Euroclearable appeared to pay dividends on Monday after 70% of demand for its first deal in the format came from non-Latin American investors.

Bond investors expect Peru to be able to successfully issue in nuevo soles next week as it wraps up investor meetings ahead of a planned Euroclearable local currency deal.

Peru will begin meeting fixed income investors on Tuesday in preparation for a benchmark-sized Peruvian sol-denominated bond of “intermediate to long maturity”, according to a note sent to investors.

Bond investors in Latin America are short of ideas as to what could provoke a sell-off that they see as necessary to release steam as borrowers make hay in highly attractive conditions.

Bond investors shrugged off state-owned oil company Petroperu’s low credit quality to pile into its debut deal in remarkable fashion as the issuer sold 15 and 30 year bonds at a tighter spread to the sovereign than its Mexican counterpart Pemex.

Peruvian state-owned oil company Petroperu will issue bonds maturing in between 15 and 30 years, said Standard & Poor’s, as the company meets investors.

Latin American bankers see a calmer period ahead for corporate new issues and some companies are already plotting deals for later in the quarter.

Peru’s ministry of economy and finance has authorised state-owned oil company Petroperu to proceed with a long awaited debut bond issue.