By Davide Scigliuzzo and Tsvetelia Tsolova
LONDON/SOFIA, Oct 31 (IFR/Reuters) - Bulgaria's state-owned energy holding BEH has launched its maiden Eurobond issue, through which it is set to raise 500 million euros ($688.55 million).
An order book of approximately 1.2 billion euros allowed the company to tighten pricing on the five-year bond on Thursday to a final spread of 320bp over mid-swaps, from revised guidance of 325bp area.
Following investor meetings in London, Berlin and Vienna, banks arranging the sale began collecting orders on Wednesday morning in the low 300s area.
The banks, Citigroup and Raiffeisen Bank International, are expected to price the bond later on Thursday.
The issue is seen offering a premium of around 200bp over the sovereign curve, with Bulgaria's 4.25% July 2017s spotted trading at a spread of around 120bp over mid-swaps on Wednesday morning.
The premium is slightly more generous than that offered by other energy companies in Central and Eastern Europe, although none of them is a perfect comparable.
BEH said in April it was looking to raise 250 million euros, most of which will go to cover a bridge financing provided by Citigroup to cover a loan from BNP Paribas to one of BEH's subsidiaries.
The remainder will be used to finance the building of new gas pipelines and cover deficits within the holding companies.
Rated BB+ with a stable outlook by Fitch, BEH has assets worth 12.8 billion levs ($9.01 billion).
It owns all the major state energy companies, including electricity utility NEK, nuclear power plant operator Kozloduy, the operator of the thermal plant Maritsa East Two, and natural gas providers Bulgargaz and Bulgartansgaz.
($1 = 0.7262 euros) (Additional reporting by Carolyn Cohn in London, and by Tsvetelia Tsolova in Sofia; Writing by Radu Marinas and Davide Scigliuzzo; Editing by Alex Chambers and Julian Baker)