Venezuela on Friday sold $500 million of its reopened Global 2034 Bond with demand high for the nation's latest dollar-denominated issue, Finance Minister Tobias Nobrega said. The minister had said earlier this week that demand for the 30-year bond with a 9.375 percent coupon was five times the government's initial $250 million offer.
The issue priced Friday at 123.5 percent, he said. "There was high demand beyond the initial offer. It was a success despite some forecasts it would not be attractive," Nobrega told Reuters by telephone from New York.
"With this we are closing the year." Venezuela, the world's fifth largest oil exporter, sold $1 billion of the 30-year bonds in January at a price of 92.976 percent as part of a broad debt refinancing to help smooth out a crunch in service payments.
The government set a price range of 122 to 125 percent for the reopened 2034 bond, which will finance government projects and service public debt. Some traders had said they believed the price was too high to draw in local investors, who could purchase the bond with bolivar currency at the fixed exchange rate of 1,920 bolivars to the US dollar.
Domestic investors in Venezuela have snapped up recent dollar bond issues as a way to skirt strict foreign exchange controls put in place last year. The curbs limit local access to hard currency and the bonds allow local investors access to dollars through secondary market sales.
High crude oil revenues and an August referendum victory by President Hugo Chavez have eased Wall Street jitters over the political confrontation that rocked Venezuela for two years after the president survived a brief 2002 coup. Critics say the currency regime has hampered growth, but the government credits the controls with beefing up Venezuela's credit rating and increasing foreign reserves to current levels of around $23 billion.