Bolivia Hires Goldman, BofA for First Debt Sale Since 1920s

By Veronica Navarro Espinosa

Bolivia plans to meet with investors next week to gauge demand for the South American country's first overseas bond sale since the 1920s.

The government hired Bank of America Corp. (BAC) and Goldman Sachs Group Inc. to arrange the meetings, according to three investors contacted by the banks. The discussions, which are scheduled for Oct. 15 to Oct. 19, will take place in Europe, the U.S. and Latin America, according to the investors, who asked not to be identified because the discussions are private.

Emerging-market countries that have never sold debt or last did so years ago are issuing bonds to take advantage of the lowest borrowing costs on record. The yield on emerging-market debt fell to a record low 4.68 percent last week, according to JPMorgan Chase & Co., as investors looked for alternatives to near-zero interest rates in the U.S. and Europe.

"People are looking at countries off the beaten path to pick up some yield," Alejandro Urbina, who manages and gives advice on $800 million of emerging-market assets at Silva Capital Management, said in a telephone interview from Chicago. "They're coming at a good time."

Bolivia plans to raise as much as $500 million selling bonds at a yield below 10 percent to fund mining and electricity projects, Finance Minister Luis Arce told reporters in Uruguay on March 16. A press official at Bolivia's Finance Ministry declined to comment in a phone interview today.

Paraguay, Zambia
Kerrie McHugh, a spokeswoman at Bank of America, declined to comment, citing company policy in an e-mail. Goldman Sachs press officials didn't respond to calls and an e-mail message seeking comment.

Paraguay plans to sell its first global bonds by mid- January, President Federico Franco said last month. The sale would follow Zambia's debut in the bond market in September with a $750 million Eurobond offering.

Angola, which shares Bolivia's BB- rating from Standard & Poor's, three levels below investment grade, sold $1 billion of debt in the form of loan participation notes due in seven years to yield 7 percent in August for its first international issue. Guatemala and Aruba also returned to the bond market this year.

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