Southern Copper Readies Bond Return

Southern Copper, the US-domiciled Grupo Mexico subsidiary operating in Peru, is set to market new 2020 and 2040 bonds. The benchmark sized deal is spotted at up to $1.5bn by ratings agencies. The miner formerly known as Southern Peru Copper Corporation plans to begin a roadshow today in Boston, and visit New York, Los Angeles, Chicago and London, finishing Monday, with a deal to follow. Marketing is expected to be directed at both high grade and EM accounts, notes a banker on the deal. The miner has broad appeal but may also offer a pickup to higher-rated names such as America Movil and Coca-Cola Femsa that recently went mostly to investment grade, he adds. Proceeds will be used for general corporate purposes including capex relating to a $2.8bn investment program over the next 3 years to increase copper and molybdenum production and enhance operating efficiencies, according to Fitch and Moody’s, which assign respective BBB and Baa2 ratings. Credit Suisse, Goldman Sachs and Morgan Stanley are managing the sale. Southern Copper’s last dollar sale was a $400m 2035 bond in 2006, according to Dealogic.