By Ben Edwards 
 

Turkish brewer Anadolu Efes Biracilik ve Malt Sanayi AS (AEFES.IS) tapped the debt markets Friday with the first investment-grade corporate bond ever to be issued out of Turkey.

The brewer of market-leading Turkish beer Efes Pilsen was seeking to price the $500 million, 10-year bond in the area of 175 basis points over the reference U.S. Treasury, about five basis points lower than where Turkey's government bonds are trading.

"It's the fifth largest brewer in Europe and the 12th largest in the world, so it's really being sold as a global brewing company," a person familiar with the deal said.

Demand for the bond is solid, with pricing being revised down from initial guidance of 225 basis points over Treasuries, the person said.

To put that rate in perspective, earlier this month Dutch brewer Heineken sold a four-part, $3.5 billion bond, with the 10.5-year tranche pricing at 115 basis points over equivalent Treasuries.

For global fund managers looking for diversification, some analysts reckon bondholders might look at Anadolu as a more attractive alternative to lower yielding debt from other European brewers such as Heineken or Carlsberg.

But for emerging market investors, the price of the bond relative to the underlying sovereign may be less appealing, despite the rarity factor.

"It looks like it's going to price flat or close to the sovereign, so from an emerging market perspective, why would you own this over a more liquid sovereign?" said Warren Hyland, fixed-income fund manager at Schroders.

However, because Anadolu has a strong credit profile, it is still a bond Schroders would consider buying at the right price, Mr. Hyland added.

In March, Anadolu took control of SABMiller PLC's beer-related business in Russia and Ukraine in exchange for SABMiller taking a 24% stake in the Turkish brewer.

That transaction made Anadolu the second-largest player in the Russian beer market with a 20% market share by value, Standard & Poor's Corp. said in a statement on the Turkish brewer's credit rating.

Anadolu is rated one notch above junk by Moody's Investors Service Inc. and S&P, the only non-financial company in Turkey to be granted investment-grade status. Turkish sovereign debt is rated one notch below investment grade by Moody's and Fitch Ratings, and two below by S&P.

(Sarka Halas in London contributed to this article.)

Write to Ben Edwards at ben.edwards@dowjones.com