CFE Sees Demand For MXP Debt

Mexican state owned utility CFE has raised MXP5bn at the tight end of guidance amid large oversubscription, according to bankers on the deal. “The substantial demand is a sign of strong liquidity in the market and that market participants in Mexico are very comfortable with CFE’s risk,” says one. The utility had been looking to raise MXP3bn-MXP5bn in bonds. CFE reopened an existing 2019 bond at 7.15% or Mbonos plus 120bp for MXP1.75bn, after receiving MXP8.87bn worth of orders. Guidance was Mbonos plus 120bp-130bp. The new 2020 floater priced at TIIE plus 45bp, versus TIIE plus 45bp-55bp talk. The MXP3.25bn floating rate tranche received MXP14.98bn worth of demand. Both tranches are amortizing, with an average life of 5 years, which Mexico-based investors say make the deal particularly attractive. Banamex and BBVA Bancomer managed the sale, rated AAA on a national scale. The 2019s were sold originally in August 2009 for MXP3.4bn, and reopened in March for MXP2.4bn at Mbonos plus 120bp at a yield of 8.05%. Last month, fellow AAA state-owned credit Pemex priced MXP5bn in a reopened 9.1% of 2020 bond to yield Mbonos plus 113bp.