Pricing Heard on CFE MXP Bonds

Mexican state-owned utility CFE will come to the domestic market Wednesday with a dual-tranche deal worth up to MXP3bn. CFE aims to reopen outstanding 8.85% of 2019 fixed-rate bonds as well as sell new floaters due 2020. Price talk on the fixed rate tranche is heard at Mbonos plus 120bp, and TIIE plus 50bp for the floating rate tranche, say investors looking at the deal. Both tranches are amortizing, with an average life of 5 years, which Mexico-based investors say makes the deal particularly attractive. The 2019s were sold originally in August 2009 for MXP3.4bn, and reopened in March for MXP2.4bn at Mbonos plus 120bp. Banamex and BBVA Bancomer are managing the sale, rated AAA on a national scale. Last month, fellow AAA state-owned credit Pemex priced MXP5bn in a reopened 9.1% of 2020 bond to yield Mbonos plus 113bp.