South Africa’s AngloGold Ashanti has purchased Sao Bento Gold in Brazil from Eldorado Gold for $70m. The buyer issued some 2.7m shares to pay for the target. The legal advisors for the buyer are Fasken Martineau and Shearman & Sterling. Sources close to buyer and seller said there were no financial advisors on either side.
Yearly Archives: 2008
Posted inDaily Brief
Rusoro Pursues Gold Reserve
Gold Reserve, a US miner operating in Venezuela, says Rusoro Mining has made an unsolicited offer to acquire it. Rusoro, a Canadian miner also in Venezuela, is offering to buy each of Gold’s outstanding shares and equity units for three shares of its own. Gold Reserve has retained RBC Capital Markets and JPMorgan as financial advisors, and Fasken Martineau DuMoulin and Baker & MacKenzie as legal advisors to evaluate the offer. Endeavour Financial is advising Rusoro, whose Canadian legal counsels are Blake, Cassels & Graydon and Anfield, Sujir, Kennedy & Durno, and its US legal counsels are Gersten Savage and Dorsey & Whitney. The offer will be open until January 21. Gold Reserve has a market cap of $33m. On the day of the announcement its shares jumped 49% to 58 cents.
Posted inDaily Brief
Peru Meets Investors, Plans Second Tour
Peru is meeting investors on a non-deal roadshow in the US and Europe that precedes a Middle East and Asia tour scheduled to take place in January, a government source tells LatinFinance. The first round of meetings started last Wednesday and wrap up this Thursday. Besides finance minister Luis Valdivieso and central bank president Julio Velarde, investors in New York, Boston and London were also set to meet executives from BCP, Buenaventura and Grana y Montero. Bankers not running the meetings expect it to lead to an early 2009 sovereign bond issue attempt. JPMorgan and Goldman Sachs are behind the tour, and $600m is the targeted new cash raising, say bankers not involved. “This is a non-deal roadshow, we are not discussing any specific transaction,” says the government source. In October, Peru was contemplating a 30-year cross-border bond issue of $400m-$600m, the sovereign’s first international foray since a $1.2bn offering of 6.55% 2037 bonds in March 2007 via Deutsche and Citi. DCM specialists say it will be lucky to get anywhere near 30 years in this market for size. Investors are waiting for stability before buying and their extreme caution would have significant impact on tenor and spread. Peru has yet to name a new public credit executive director, following the late November resignation of Pablo Secada. The next most senior official in the department is Betty Sotelo Bazan, general director of the national department of public indebtedness. Meanwhile, the IMF late last week put out a bullish report on Peru following a visit to Lima. “The Peruvian economy is expected to be among the fastest growing economies in the world in 2009, with real GDP growth projected at 6%,” says the Fund. “With global price disinflation already underway, inflation should decelerate below 3% by end-2009,” it adds.
Posted inDaily Brief
Titularizadora Colombiana Readies MBS
Colombian securitization shop Titularizadora Colombiana will Wednesday start selling some COP390bn ($178m) in 10-year notes backed by mortgages issued by BBVA, BCSC, Bancolombia and Davivienda. The TIPS Pesos E-9 issuance will be denominated in COP and have a fixed rate. An auction will be held to determine a minimum price. Titularizadora last closed a sale of 2018 2.2-year average life MBS December 4. The notes were priced with a coupon of 5.99%.
Posted inDaily Brief
Brazil’s Mercantil Buying Back Bonds
Brazil’s Banco Mercantil is buying back up to $100m in face value of its 8.5% of 2010 bonds through a modified Dutch auction. The minimum price is 85 and the auction expires today. The bonds were trading 78-83 before the buyback was announced last week and the company is funding the deal with cash on hand, according to a banker on the transaction. UBS is dealer manager.
Posted inDaily Brief
German Firm Buys VW Brazil Unit
German vehicle manufacturer MAN Group is acquiring Brazil-based VW Truck & Bus from Volkswagen for EUR1.175bn enterprise value. MAN, in which VW has a 30% voting stake, is financing the acquisition with cash on hand and existing bank lines, according to a banker close to the process. Rothschild and Goldman Sachs advised the buyer, while UBS worked with Volkswagen. “Acquiring the Brazilian company and its strong brand enables MAN to expand into the South American market, one of the fastest-growing regions,” says the buyer. “The new business area with its strong market position will provide MAN with access to the Latin American market,” says MAN CEO Hakan Samuelsson. The target is Brazil’s largest truck manufacturer and leads the market for trucks with a gross vehicle weight of more than five tons, according to MAN. The vehicles are primarily sold in LatAm and South Africa, and around 47,000 trucks and buses were supplied in 2007, it adds. Bankers away from the transaction say the deal may be part of a larger strategy between Volkswagen and MAN, which have existing cross investments and shareholder agreements in place. The unit will be transferred to MAN January 1. Both companies’ boards have approved the transaction. MAN makes commercial vehicles, engines and mechanical engineering equipment with annual sales of approximately EUR15.5bn and around 55,000 employees worldwide.
Posted inWeb Articles
The Latin America China Investors Forum (LA-CIF)
The Forum is specifically designed to enable Latin American companies and funds to present their compelling investment opportunities, strategies and stories in order to create long-term trade and investment partnerships or to access the huge pools of liquid and actively diversifying investment from the region.
Posted inDaily Brief
Aracruz Blows Through Deadline for Derivative Talks
Brazilian paper and pulp company Aracruz failed to come to an agreement with banks regarding a settlement over some $2.13bn in derivatives losses it incurred by taking speculative bets on the direction of the BRL. A November 30 deadline was extended until Friday, December 12, but Aracruz says in a statement to the CVM posted Friday that an agreement has not yet been reached, and that discussions are still going on. A local report in Valor noted last week that the group of banks Aracruz is in talks with offered a 7-year loan at a rate of some 700bp over Libor, though that apparently wasn’t enough to conclude the talks. Upon finding out about the loss in September, Aracruz fired its CFO Isac Zagury and last month shareholders voted to sue the executive over the loss. The FX loss also led to a halting of VCP’s bid to acquire a 28% stake it didn’t own in Aracruz from the Lorentzen Group. That deal is still pending and may move ahead next year if the company can get past its derivatives woes.
Posted inDaily Brief
LatAm, Brazil Equity Flows Stay Positive
Flows into the LatAm and Brazil equity funds tracked by EPFR closed the week ended December 10 on a positive note, according to the service. Brazil equity funds saw inflows of $71.4m, marking the third consecutive week of net inflows for the asset class. Six out of the past seven weeks have seen positive inflows into Brazil funds, which today have total assets of $5.5bn. YTD outflows stand at a relatively small $148.9m. In LatAm equities, the YTD outflows account for a larger portion of total assets under management (AUM). Some $5.49bn in funds have fled the region’s equity funds tracked by EPFR, representing 16.5% of total AUM, which stand at $11.8bn today. In the week ended December 10, the outflows were $53.7m, or 0.5% of AUM. Negative performance of the region’s indices has contributed to a $17.0bn drop in total AUM for LatAm funds. The recent positive flows into Brazil and LatAm may be driven by a withdrawal fatigue – there isn’t much left to pull out – as well as the fairly consistent forecasts from research shops that 2009 may see a substantial bear market rally in EM equities, says EPFR analyst Brad Durham. “Sellside research reports have been delivering fairly consistent forecasts for 2009 that includes some 30%-60% in equity upside next year,” remarks Durham.
Posted inDaily Brief
EM Debt Funds Jump
EM debt funds rose 2.73% in the week ended December 11, posting the highest jump of all debt funds tracked by Lipper. International income funds are up 1.21% and global income funds are up 0.64% for the week, Lipper data shows. YTD growth for these funds remains negative, however, with EM funds down 21.08%, international income funds down 2.34% and global income funds down 8.40%.