Fibria Sells $1 Billion of 10-Year Bonds to Yield 9.375 Percent - Bloomberg.com

Fibria Sells $1 Billion of 10-Year Bonds to Yield 9.375 Percent - Bloomberg.com

By Veronica Navarro Espinosa

Oct. 26 (Bloomberg) -- Fibria, the world’s biggest pulp maker formed by Votorantim Celulose & Papel SA’s takeover of Aracruz Celulose SA, sold $1 billion of 10-year.

The Sao-Paulo based company issued the bonds to yield 9.375 percent, according to Bloomberg data. Bank of America Corp., Deutsche Bank AG and JPMorgan Chase & Co. arranged the bond sale, according to a person familiar with the transaction who asked not to be identified because he’s not authorized to speak publicly.

Fibria was formed when VCP rescued Aracruz after it reported $2.13 billion in losses on currency derivatives. Proceeds from the bond sale would be used to “pre-pay existing derivatives-related debt” at Aracruz, Moody’s Investors Service said Oct. 16. Moody’s rated the notes Ba1, one level below investment grade.

Rodrigo Bueno, a spokesman at Fibria, declined to comment on the sale.

Fibria is selling bonds overseas as a recovery in Latin America’s biggest economy boosts demand for Brazilian corporate debt. Last week Petroleo Brasileiro SA, Brazil’s state- controlled oil producer, sold $4 billion of bonds while Tam SA, the country’s biggest airline by passengers carried, sold $300 million of 10-year notes.

To contact the reporter on this story: Veronica Navarro Espinosa in New York at vespinosa@bloomberg.net"