Berau's $500 million bond issue gets enthusiastic response

Asian high-yield bond issues continue to find robust support among investors throughout the world. In the secondary markets they have outperformed European and, especially, US high-yield paper for two consecutive weeks. Spreads have tightened by as much as 53bp, according to Morgan Stanley.

So, the launch of Berau Coal Energy’s $500 million deal on Tuesday was to an enthusiastic audience and made the company’s statement a month ago that it intended to raise funds at a maximum interest rate of 9% seem rather conservative.

The issue was priced late Tuesday afternoon, New York time. It pays a 7.25% semi-annual coupon and was re-offered at...