UMS to Launch Exchange Warrants

Mexico is set to launch the sale of debt exchange warrants with a total notional value of $1.25bn allowing investors to exchange foreign currency debt for peso debt. Today and tomorrow, investors can buy two classes of warrant allowing the exchange of 21 series of dollar, euro, deutschemark and Italian lira-denominated bonds with maturities between 2009 and 2034 for local bonds. The first warrant has a notional value of about $1bn and offers peso-denominated bonds due 2014, 2017 and 2036. The second is worth roughly $250m and offers 2017 and 2035 debt denominated in UDIs. Holders of the warrants will be able to receive their new bonds on October 9. Barclays and Merrill Lynch are managing the transaction.