January 12, 2017 / 3:55 PM / in 9 months

UPDATE 1-Chile announces peso-denominated 144A/Reg S bond tap

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By Paul Kilby

NEW YORK, Jan 12 (IFR) - The Republic of Chile announced on Thursday a peso-denominated 144A/Reg S bond due February 28 2021, with pricing set as early as January 18.

The new bond is a tap of a local instrument that priced last year and will be sold in a Euroclearable format to foreign investors, a source familiar with the deal told IFR.

The structure is similar to what has been done in Mexico, where the sovereign and some corporates such as oil company Pemex have sold domestic bonds that can be settled in both Euroclear and locally.

The idea is to widen the appeal of local currency instruments among foreign accounts and bring more depth to that market.

The security carries a 4.5% annual coupon, accruing from the issuance date of September 1 2016. The deal is governed by Chilean law and is listed on the Santiago Stock Exchange.

Bookrunners are BNP Paribas, Citigroup, Goldman Sachs and JP Morgan. Local currency ratings are Aa3/AA/AA-.

The bond is being led by BNP Paribas, Citigroup, Goldman Sachs and JP Morgan. The country’s local currency ratings are Aa3/AA/AA-. (Reporting by Paul Kilby; Editing by Marc Carnegie)

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