Tuesday, 20 January 2009

Israel Electric Considers Tapping Bond Markets With Benchmark-Size Issue

This just happened a few minutes ago. Israel Electric Corp., rated Baa2 by Moody's Investors Service and BBB+ by Standard and Poor's, tapped JPMorgan Chase & Co. and Citigroup Inc.to handle an offering of U.S. dollar-denominated bonds to international investors, as part of a MTN issuance programme. The size is likely to be benchmark size, or at least $500 million of bonds will be offered, according to a mandate obtained by MM by e-mail.

Subject to market conditions, a benchmark size transaction should follow a roadshow in European and the U.S. markets starting today. In recent weeks, emerging markets sovereigns (especially Latin America and Asian countries) as well as two South Korean companies, offered bonds to investors in what most saw as the opening of a window of opportunity for borrowers to raise cash in a challenging market. Investors might be becoming more selective in their bond purchases in the coming days. We will keep you informed of this specific transaction.

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