Mexican homebuilder Sare plans a MXN1.6bn ($115.9m) sale of non-core assets over the coming two years in a bid to pay off debt and finance ongoing projects. Sare shareholders approved a plan that entails selling MXN800m ($58m) in undeveloped lands and unfinished residential projects in 2012, as well as an additional MXN800m in assets the following year, a Sare investor relations officer tells LatinFinance. “We are selling assets that won’t affect our growth going forward,” the official says. Sare is approaching the sale through several fronts. It will rely on real-estate service firms CB Richard Ellis and Cushman & Wakefield as well as LaSalle Investment Management and a number of local real-estate firms to sell a portion of the assets. Some will also be divested through the banks that hold them as guarantees. Half of the MXN1.6bn raised from the sale will be used to finance ongoing projects with the rest devoted to paying off debt. In the company’s bid to deal with outstanding debt, shareholders also agreed to extend the maturities of MXN2.44bn in debt.
Yearly Archives: 2011
Moody’s Considers Upgrade for Net and Embratel
Moody’s has put cable company Net Servicos’ Ba1 corporate family rating and Brazilian telecom Embratel’s Baa2 on review for possible upgrades as new regulatory changes look set to shakeup the sector. This comes after the elimination of a 49% foreign ownership cap for Brazilian cable companies and a new law that allows fixed-line telecom companies to offer TV services over their networks, the agency says. The review process was also triggered by the possibility that Embratel, which is majority owned by Mexico’s America Movil, may son become Net’s controlling shareholder and that Net, Claro and Embratel will soon start bundling their telecommunications services. “The acquisition of the controlling interest in Net would allow America Movil to expand its presence and services in Brazil, a critical market for AMX,” the agency says.
PetroLatina to Borrow up to $100m From BNP
UK-based PetroLatina has secured an up to $100m 4-year revolving credit facility through BNP Paribas, it says. The loan will be used to repay an existing facility with Macquarie and help fund its oil and gas operations in Colombia. PetroLatina has already secured $36m, $29m of which went towards existing facility repayment and Macquarie price hedging contracts. Interest will be paid at Libor plus 4.5%. UK-listed PetroLatina operates in Guatemala and Colombia.
Rusoro, Venezuela Extend Compensation Talks
Venezuela has decided to extend a 90-day period for talks with gold miner Rusoro as it decides how much to pay the company for its nationalized assets. The size and form of compensation remain unclear at this stage, but a person familiar with the situation tells LatinFinance that depending on the gold price used, the company values its assets at roughly $1bn. Rusoro and Venezuelan officials could not immediately be reached for comment. The parties have agreed so far to extend the talks to March 14 to decide on a way forward. So far discussions have revolved around the possibility of Rusoro selling all of its assets to the state with a second option of keeping a 45% stake in a new venture controlled by the government. Negotiations hinge on Venezuela’s decision to pay compensation based on unamortized book value for assets that Rusoro acquired gradually at fair market prices. Venezuela’s government passed a law in September to keep gold extraction in the hands of the state. As such, all mining companies must transfer assets to a new entity and accept a minority interest of as much as 45% of the new business, with the government in control. Rusoro is a mining vehicle founded by Vladimir Agapov and his son Andre, two Russian businessmen who spent years acquiring mining properties in Venezuela under the administration of President Hugo Chavez. In recent weeks Venezuela has moved to finalize compensation agreements with a number of companies affected by the president’s nationalization campaign.
Correction:
A December 21 daily brief story entitled “LatAm DCM Volumes Hit Levels” incorrectly suggests that Deutsche Bank was the only bank whose position in the league tables was boosted by leading RegS issues for the Venezuelan sovereign and PDVSA. Credit Suisse and Citigroup also led such deals this year.
Banco de Bogota Closes $500m Loan
Banco de Bogota has closed a $500m 3-year bullet facility, bringing on board a total of 12 banks and wrapping up a take-out for a bridge used to finance the acquisition of Central America’s BAC-Credomatic. Coming late in the year and at a time when European banks are retrenching, the transaction perhaps moved slower than initially expected, but leads Citi, HSBC and JPMorgan eventually brought in an eclectic group of 9 banks. Banco de Credito del Peru, Commercebank, Bank of Tokyo, Wells Fargo and Standard Chartered participated as MLAs, while Helm Bank, Corpbanca, Mercantil Commercebank and the Israel Discount Bank signed up as managers. The loan pays a margin of Libor plus 225bp, and fees ranged between 35bp to 100bp.
DF Brings MXP1.77bn 5-Year
Mexico City’s government has raised MXP1.77bn ($128m) through a sale of a domestic bond. The 5-year floating rate notes priced at TIIE+30bp, flat to talk and tight to quasi-sovereign CFE’s MXP1.358bn 4-year notes that came last week at TIIE+35bp. Deutsche Bank managed the sale, rated AAA on a national scale. This bond represents the sixth issuance under Mexico City mayor Marcelo Ebrard’s administration. Demand topped MXP2.5bn with participation coming from mutual funds, private banking, Afores, banks, and insurance companies. Proceeds will help fund public works. It last raised MXP2bn through a 2.1x oversubscribed dual-tranche re-opening in 2010. The MXP500m floating rate tranche paid TIIE flat, while the fixed-rate tranche for MXP1.5bn paid Mbonos+105bp The bonds have maturities of 4 years 8 months and 9 years 8 months, respectively.
Itau Set for ECM Table Crown
Itau is leading other LatAm ECM shops in volume heading into the final week of 2011, according to Dealogic data. The Brazilian bank had taken credit for 26 offerings worth $3.51bn year to December 16, and was set to beat out Santander ($2.58bn from 15 issues) and Credit Suisse ($2.55bn from 19 deals). The LatAm regional total stood at $30.96bn from 76 deals on the year, down from the $54.07bn seen through 72 transactions in 2010, when BTG Pactual took the top spot and Itau came in second. This year, BTG has fallen to seventh place over this period, according to Dealogic data. Itau also leads the tables in fees for 2011, earning $82m, or 13.3% of the pool. It beat out JPMorgan, with $62m (10.1%), and BTG with $61m (10.0%). Out of a global ECM volume of $620.9bn (down 31%), LatAm’s total of $30.96bn pales in comparison to the $188.7bn seen in the US, the $155.1bn in EMEA and the $188.3bn in Asia Pacific ex-Japan.
Marfrig Sells Logistics Assets In Management Deal
Brazil’s Marfrig has agreed to sell logistics operations assets to JSL, a specialist in supply-chain logistics management, as part of a broader agreement to secure management services for the transportation and warehousing of its products. Under the deal, which is still under negotiation, Marfrig is set to transfer the management of its Brazilian logistics operations, including transportation, warehousing and shipping, to JSL under a 10-year agreement, which includes the management of Marfrig’s distribution centers. The company will also sell some logistics assets to JSL for BRL150m ($80.7m). The terms of the 10-year contract are still under negotiation, says a spokesman for JSL, but the asset acquisition is part of JSL’s supply-chain management approach. The JSL official noted that the company typically signs operations contracts that can yield a 15% unlevered internal rate of return.
Mexichem Still Pursuing Dutch Pipemaker
Mexican chemical company Mexichem intends to continue its pursuit of Dutch pipemaker company Wavin, just days after the target rejected an improved acquisition offer. Mexichem plans to request an approval from Dutch regulatory authorities for its non-binding offer for Wavin sometime during the coming four weeks. On December 6, Mexichem improved an unsolicited offer for Wavin by offering EUR9 in cash per ordinary share or an implied EV/Ebitda multiple of 7.5x. The company first approached Wavin in late November with an offer of EUR8.5 per ordinary share. Wavin officials have rejected both offers, arguing the company is worth far more.