Brazil’s Egesa has sold BRL160m ($101.43m) in 2014 domestic bonds. The infrastructure-focused engineer and builder will pay interest at the DI+2.9%, and the bonds amortize monthly. Banco do Brasil managed the sale, done under the rule 476 restricted format.
Yearly Archives: 2011
Posted inDaily Brief
Caue Finance, Loma Negra See Early Tenders
Caue Finance and Loma Negra saw holders tender $91.84m of 8.875% 2015s and $49.53m of 7.25% of 2013s by the early bird date of July 11, while also establishing a new early deadline of July 19. The companies are indirect subsidiaries of Brazilian conglomerate Camargo Correa. So far the amount tendered represents about 61.2% and 49.5% of outstanding notes respectively. For each $1,000 in principal holders of the 2015s and 2013s get $1,750 and $1,070, which include a tender premium of $165m and $60 respectively. Early bird premiums on both come to $10. That drops to $1,165 and $1,060 for those that tender after the early bird but before expiration date of July 26. Caue Finance has also received sufficient consents to eliminate restrictive covenants, while Loma Negra holders will hold a meeting on July 26 to seek approval on amendments. BAML is acting as sole dealer manager.
Posted inDaily Brief
Diniz’s GPA Proposal ‘Unsolicited, Hostile and Illegal’
The board of Casino Groupe has rejected a proposal to merge Brazilian retailer Grupo Pau de Acucar (GPA) with the Brazilian operations of its French competitor Carrefour. The move marks the latest battle in the war between the two French rivals for control of GPA. The Casino board made the announcement following a meeting in Paris with Abilio Diniz, GPA’s chairman and owner of 32.7% of the company stock. The board decision was unanimous, with the exception of Diniz. Casino remains the largest shareholder in GPA with 43% of the total stock. According to the company, the proposed transaction is not in the best interests of GPA, its shareholders, or Casino. The board cites a declining hypermarket sector, expansion into low-growth geographies, exposure to Carrefour, high execution risks and over-aggressive synergy expectations. It also describes the proposal as “unsolicited, hostile and illegal.” For shareholders, however, the deal could be a positive, given that some equity analysts say it represents an EV-to-Ebitda multiple of 6.1x versus GPA’s trading multiple of 5.4x. One analyst says the deal will have to be renegotiated to win over Casino, whose approval is required for any transaction to go forward. But if Casino insists on retaining its position as the controlling shareholder, Carrefour may be unable to offer any terms that Casino would find acceptable, the analyst adds. Brazilian development bank BNDES, which had announced it would provide BRL2.5bn in equity and debt financing for the merger alongside BTG, has been rumored to be withdrawing. BTG is now heard looking for other Brazilian backers in order to salvage an agreement. BAML, Goldman Sachs, Rothschild, and Santander are advising Casino, while Lazard is heard doing the same for Carrefour. GPA’s stock fell 1.569% on the NYSE to close at $42.03 Tuesday.
Posted inDaily Brief
Elektro Eyes Local Bond
Elektro is preparing a BRL300m ($190m) bond in Brazil’s domestic market. The utility and AEI subsidiary plans a two-tranche sale, with details and amounts to be specified during bookbuilding. A 2016 tranche will pay the DI plus up to 1.12%, and an IPCA-linked 2018 will pay a fixed rate determined by taking the yield on the government’s NTN-B bond and adding a 125bp spread. Proceeds are going to repay existing debt and for working capital. Banco do Brasil and HSBC are managing the sale, to be done under the rule 476 restricted format.
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Fovissste Sets RMBS Date
Mexican government housing agency Fovissste has set a August 17 pricing date for an up to MXP4.2bn ($357m) equivalent UDI-denominated RMBS, according to a banker on the deal. Proceeds from the 2040 bond will be used to originate mortgages. BBVA Bancomer, Bank of American Merrill Lynch, IXE, Banorte are bookrunners. The bonds are rated AAA.
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Golden Phoenix Signs LOI for Santa Rosa
US mining company Golden Phoenix Minerals has agreed to acquire a 60% interest in the Santa Rosa gold mine from Panamanian corporate Silver Global. Under the non-binding terms of the LOI, Golden Phoenix proposes to acquire a 60% interest in Santa Rosa with an option to buy an additional 20% interest after achieving certain milestones. This is in consideration for $20.5m in cash over time and $4.5m in shares of Golden Phoenix common stock (at a deemed value of $0.18 per share), as well as certain preferential payments from cash flow out of gold production.
Posted inDaily Brief
Hillview Generates Mixed Reviews
Hillview Enterprises’ second attempt to issue a debut bond in the international markets is meeting with mixed reactions among investors. The gaming company is considered a decent revenue generator and some hedge funds like the credit, but accounts who attended roadshow meetings have expressed concerns about its dependence upon the goodwill of the Argentine government and the use of proceeds. According to one investor, 16% of proceeds will go towards dividend payments to shareholders, 30% for loan repayments, 25% for its Carrasco Nobile Casino project, 10% for relocation and 19% for general corporate purposes. Some accounts have declined to participate given the risks and the relatively small size of the issue, while others say they would require a 10%-12% yield to place it in their portfolios. An April 2010 attempt at coming to market with a debut $100m 2016 bond through BCP was shelved. Barclays now has the mandate for a similar $100m 5-year NC3. The gambling company has yet to execute a transaction as it awaits a suitable window following investor meetings that ended Friday.
Posted inDaily Brief
MMX Retains Itau, West LB
MMX has retained Itau and West LB as financial advisors to help the Brazilian mining major to structure an up to $1.8bn project financing package for the expansion of its Serra Azul unit. MMX says it will approach development banks and other institutions. MMX anticipates a 75%/25% split between debt and equity financing. The company says it plans to invest BRL4bn ($2.53bn) to upgrade and expand the iron project.
Posted inDaily Brief
Panamericano Upgraded by Fitch
Brazil’s Banco Panamericano had its national rating upgraded to AA minus from A minus with a stable outlook by Fitch. The rating reflects BTG Pactual’s support, as well as the benefit of having Caixa Economica Federal as the shareholder and main funder. Panamericano was taken over by BTG and Caixa from Grupo Silvio Santos in February following the discovery in November of accounting irregularities.
Posted inDaily Brief
Repsol Sells YPF Block
Repsol has raised ARP351.3m ($86m) through a block sale of YPF shares in Argentina’s domestic market. The Spanish parent sold 1.99m shares in the Argentine oil and gas company at ARP177 each, representing a 7.8% discount to the previous ARP192 closing price. Shares closed at ARP183.00 Tuesday. BBVA Banco Frances and Raymond James Argentina managed the sale. The deal tacks on another 0.5% of YPF to the portion Repsol has been selling as part of a long-term plan to reduce its stake while keeping a majority. In May, Grupo Petersen agreed to exercise an option to buy 10% of YPF from Repsol for $1.3bn. That deal was the most recent in a string of transactions, including the $1.23bn secondary sale of YPF ADS in March that reduced Repsol’s position in YPF to about 58%.