(Bloomberg) — A rum maker is set to revive Venezuela’s dormant local capital market by selling the first dollar bonds from a private company in more than two decades.

Ron Santa Teresa, the country’s largest rum producer, received the government’s approval to sell $300,000 in commercial papers denominated in dollars, according to a statement published by Superintendencia Nacional de Valores (Sunaval). The last time a private Venezuelan company sold dollar debt was in the 90s, according to local brokers.

The deal comes nine months after President Nicolas Maduro broadened financing options for local companies by allowing them to sell dollar-denominated securities as the economy goes through its seventh year of contraction and hyperinflation has made the bolivar worthless. The move underscores the informal dollarization that picked up last year.

“The notes will be placed in record time,” said Marco Gasperini, president of Ratio Casa de Bolsa, a Caracas-based investment advisory firm that is coordinating the deal.

Ron Santa Teresa’s notes will revive a capital market that has been dormant since late President Hugo Chavez imposed currency controls in 2003. While access to international funding was never blocked by the government, U.S. sanctions on the country and the capital controls discouraged dollar deals, especially after restrictions were tightened in 2010.

The commercial papers, which will be ruled by local law, will be sold next week and are due in one year, according to Ratio Casa de Bolsa’s Gasperini. The notes will have no coupon and are expected to be placed at 96% of their face value. The capital raised will be used to boost rum exports, according to the regulator.

Santa Teresa has been making rum for the past 223 years and is headed by Venezuelan businessman Alberto Vollmer. This year the company made two share offerings, raising a little over $350,000 on the first one. The company didn’t comment on the details of the new deal.

Dull market

The sale of dollar-denominated bonds in Venezuela is a big event for a market that barely moves. On some days, the trading volume in the local exchange is as low as $7,000, according to Jose Miguel Farias, finance director at Caracas-based brokerage Mas Valor.

“These initiatives can help energize the market,” said Farias. Foreign-currency debt issuances could become an outlet for a credit-starved private sector and at least two more are in the pipeline, according to him.

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Source: Bloomberg