Cemex Forced to Hold MXP Bond

Blue chip Mexican issuer Cemex has postponed the sale of up to MXP3bn in 2010 floating-rate notes because of poor market conditions, say bankers managing it. The transaction, which had been scheduled for this week, is now expected in October. Proceeds from the issue, rated AA+ on a national scale, were scheduled to repay a short-term bank credit priced at Libor+35bp that was used to refinance debt. HSBC is managing the transaction. The sale would be the 10th from a MXP30bn shelf and follows a MXP1bn 2010 bond priced in April at TIIE+36bp via ING and Santander. Some analysts are questioning the strength of Cemex amid declining demand for cement in Spain, the UK and US. In particular, some say it has developed an over-exposure to markets like California, Arizona and Florida. Short tenors and smaller issuance amounts are reflective of a Mexican market that had already been slowing before this month’s world financial markets meltdown. With the exception of Wednesday’s MXP1.5bn 2010 ABS from GMAC Mexicana, Mexican DCM has come to a standstill. Debt transactions from corporates including Molymet, Pinfra and Metrofinanciera have also been shelved.