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THE Republic of Turkey enjoyed a blow-out reception for its $600m 10 year Euro/144A offering this week, confounding the predictions of some market participants that the B1/B rated sovereign would struggle to attract a strong US investor bid for its paper. At $600m the transaction was the country's largest ever dollar issue and at 10 years its longest dated international bond since it lost its investment grade status in 1994.

SIGNS of a possible dimming of investor interest in Latin new issues emerged last night (Thursday) when Bachoco, the Mexican chicken processor, priced its equity offering at the lowest end of its price talk. The deal, led by JP Morgan, was priced at $17 per share, compared with a $17 to $19 indicated range. A total of 7.5m ADSs (with each ADS representing one B share and one L Share) were offered in the US, internationally and domestically.

THE LATIN markets are bracing themselves for the chance of another billion dollar plus global bond from a Latin sovereign -- this time from the Republic of Brazil, strongly rumoured to be planning an announcement of either a 10 year or a 20 year bond issue at the IMF meeting. Bankers said yesterday that the republic's central bank called for bids on either 10 year or 20 year global bonds around a month ago, with the intention of making a splash at the IMF, either with a blowout deal executed just prior to the fund's meeting, or with the announcement of a mandate.

Market report Compiled by Gerard Perrignon, Hambros Bank Ltd, London. Tel: +44 171-865 1759

BAYERISCHE Hypo-und-Vereinsbank is set to raise nearly DM1.5bn ($875m) from international investors as part of a DM3bn capital increase. JP Morgan will lead the global offering portion of the exercise, which completes a restructuring begun by Bayerische Vereinsbank's merger with Bayerische Hypo-Bank.

AS foreshadowed in Euroweek, SBC Warburg has been mandated to lead manage the recapitalisation for the Paris-based property group, Société Fonciere Lyonnaise (SFL). The bank will run the books on the process which will include the sale of a range of instruments to international and local investors. The company will raise Ffr600m through the issue of new shares where the proceeds will be used directly by SFL. Existing shareholders will then sell stock to raise up to a further Ffr600m. Additionally, the lead manager will construct an equity linked debt financing which will take the form of a Ffr1.2bn offering of convertible bonds.

EUROPEAN issuers continued to tap the market for equity-linked debt finance, with a variety of synthetic and vanilla deals launched into a market which still offers a warm reception to quality names. SGL Carbon this week raised DM150m in six year exchangeable bonds through lead manager, Commerzbank. The German carbon-graphite electrode company is familiar to the equity capital markets, having gone public more than two years ago in a deal led by Kleinwort Benson and Dresdner Bank.

LEAD MANAGER Commerzbank this week braved earlier choppy market conditions to raise DM1.2bn for the diversified German steel producer, Thyssen. The firm sold 3m ordinary shares in an international offer which was priced early this week at DM400 against a close of DM408. In the week preceding the pricing considerable weakness in the US market had spread to continental Europe.

DUTCH MORTGAGE bank Westland/Utrecht Hypotheekbank has signed a $3bn Euro-MTN programme in a bid to promote its credit in the international markets and diversify its sources of funding. Arranged by ING Barings and Merrill Lynch, the programme will be used by the bank as a core funding vehicle alongside its guilder Euro-MTN programme launched last year, which has notched up outstandings of over Dfl 3bn.

THE FLOTATION of China Telecom looks set to break all Asian equity capital market records as the company and its advisers prepare to begin pre-marketing the share offering in Asia next week.The Hong Kong-listed IPO, one of the most eagerly awaited new equity issues from the Asia-Pacific region yet, will be China's largest international share offering and a bellwether of investor sentiment towards the country. Despite the current turbulence in Asian financial markets, Chinese officials hope the deal will focus global attention on the country's remarkable recent economic development. Led by joint bookrunners Goldman Sachs and China International Capital Corp (CICC), the 2.2bn share flotation has been shrouded in secrecy following threats by the Hong Kong Stock Exchange (HKSE) to dismiss syndicate members caught disseminating unauthorised information.

THE EURO-MTN market's rapidly growing telecom sector was boosted this week with the establishment of a $1bn Euro-MTN programme for Belgacom and the announcement by Deutsche Telekom that it had mandated Deutsche Morgan Grenfell to arrange its forthcoming Ecu3bn Euro-MTN facility. Belgacom follows Telenor, Telefónica de Espa¥a, KPN and most recently Telia into the market. Belgacom's programme was arranged by Merrill Lynch, which is joined in the dealer group by Deutsche Morgan Grenfell, JP Morgan, Morgan Stanley Dean Witter, Salomon Brothers, SBC Warburg Dillon Read and UBS.

NEW EURODOLLAR issues again struggled to get off the ground this week, leaving debt syndicate managers increasingly concerned about the state of the sector.