Flash Fixed Income Report /
Brazil

Brazil: Klabin's new issue

    Rafael Elias
    Rafael Elias

    Director, Latin America Credit

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    Tellimer Research
    15 January 2020
    Published byTellimer Research

    Brazil's Klabin, S.A. is expected to come to the bond market with a US$200mn tap of its currently outstanding US$500.0mn, 7.0% senior unsecured bonds due 2049 (BB+/BB+), through its wholly-owned Special Purpose Vehicle (SPV) Klabin Austria GmbH. The initial price guidance is "in the very low 6.0% area".

    Klabin is one of the Brazil's leading producer and exporter of paper products, and a leading paper recycling company that manufactures packaging paper, paper board, corrugated boxes, industrial sacks and timber in logs for saw mills and veneer plants. 

    The bonds are currently seen trading at cUS$113.952 (ALLQ) to yield c5.97% (g-spread 375bps; z-spread 409bps). Based on this, we believe that the final pricing of the tap will actually pierce the 6.0% level.

    Pricing is expected today.