So-called "plastic currency" charged up an impressive final tally last week as investors oversubscribed the Merrill Lynch-led pricing for Visanet. The credit-card deal closed upsized at US$500 million, market sources report. The deal had initially been heard at US$300 million (see ASR 6/30, p. 25).
A 144A with no registration rights, the deal priced at 350 basis points over Treasurys. Maturity was eight-year final/five-year average life. One source noted the placement drew a "good mix of private and public investors." News that Visanet shareholders ABN Amro and Visa International had pulled out in the later stages of the deal's ramp-up apparently did little to erode investor appetite.
The Visanet transaction is the first credit card deal out of Latin America originated by a non-bank entity. Moody's Investors Service, Standard & Poor's and Fitch Ratings gave the paper preliminary ratings of Baa1'/'BBB+'/ BBB+' respectively.
In 2002, Brazil's Visanet processed 793 million Visa credit and debit card transactions for a total of R$42 million (US$15 million) in 2002.
Market sources report Visanet's Brazilian rival, Mastercard processor Redecard, is also prepping a credit card receivables deal, although that is reportedly in preliminary stages.