Telekom Malaysia launches roadshows

Led by Deutsche Bank and Merrill Lynch, the BBB/Baa2-rated credit will begin roadshows in Hong Kong on Thursday for a $250 million euro-144a. The 10 year deal, which may be increased to $300 million subject to demand, will then be presented to investors in London and East Coast USA before pricing on November 30. There will also be four co-managers.

Bankers believe that the combined impact of the deal's small size and lack of supply from Asia should see the transaction price at a very slim premium to the sovereign's outstanding 2009 line, currently trading at a bid/offer spread of 228bp/220bp over Treasuries. Telekom itself has an outstanding 2005 bond at 200bp/190bp over, which puts the company at a roughly 15bp premium to implied levels for a Malaysia 2005 at 185bp over.