Chilean telephone company Compania de Telecomunicaciones de Chile's (CTC) Wve-year e200 million bond deal last July was one of the brightest and most fought over deals to come out of Latin America in the past year. Mandates to bring Chile's leading telecom company to the market were hotly contested. They eventually went to Germany's Dresdner Kleinwort Benson and Spain's BBV. The two bookrunners, helped along by JP Morgan and ABN Amro as joint leads, managed to bring the deal to market at incredibly tight margins.
When swapped into dollars, the deal came in at around 200 basis points over US treasuries, around 40bp tighter than the level at which an existing CTC yankee bond was trading at that time. Although criticized as aggressive by some of the investment bankers' competitors, the deal has to be seen as a triumph for the issuer and for the banks that used their European distribution power to excellent effect to get the deal away at such a price.
Although some members of the syndicate became nervous when the market showed signs of weakness, the leads' decision to hold on to the original pricing and take on some of the bonds themselves was in the end vindicated.