Vale Raises $1.75 Billion in its Biggest Overseas Bond Offering Since 2006

Vale SA, the world’s largest iron- ore producer, sold $1.75 billion of bonds in its largest overseas debt sale since 2006 after boosting the size.

The Rio de Janeiro-based company issued $1 billion of 10- year bonds to yield 210 basis points more than similar-maturity U.S. Treasuries, and $750 million of 6.875 percent notes due in 2039 at a spread of 235 basis points, according to a person familiar with the offering who declined to be identified because he’s not authorized to comment. A basis point is 0.01 percentage point.

That is Vale’s biggest international bond sale since November 2006, when it sold $3.75 billion of bonds due in 10 and 30 years, according to data compiled by Bloomberg. The company initially marketed $500 million of the bonds due 2039, the person said.

Credit Suisse Group AG and JPMorgan Chase & Co. are arranging the sale, Vale said today in a regulatory filing.

Vale’s 2039 bonds fell 2.7 cents to 111 cents on the dollar to yield 6.07 percent at 1:37 p.m. in New York, up from 5.89 percent yesterday, according to data compiled by Bloomberg.

Vale is one of at least four Brazilian companies marketing international bonds this week. Telemar Norte Leste SA, Brazil’s biggest fixed-line phone company, may sell $1 billion of 10-year bonds as soon as today, said a person familiar with the offering who declined to be identified because terms aren’t set.

Brazil’s state development bank, known as BNDES, plans to issue 1 billion euros ($1.27 billion) of seven-year bonds, Moody’s Investors Service said in an e-mailed statement. Construction company Odebrecht SA sold $500 million of perpetual bonds yesterday after doubling the size of the offering.

To contact the reporters responsible for this story: Carlos Caminada at ccaminada1@bloomberg.net; Gabrielle Coppola in New York at gcoppola@bloomberg.net

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