Peru Group Readies Leverage Push

Peru’s Grupo Brescia, by far the country’s largest holding company, is heard to be taking its first steps to access the debt markets. The group, which owns significant stakes in 52 companies in South America, including Peru’s largest fishery, its largest tin mine, and a minority state in BBVA Continental, has no outstanding debt or equity securities in Peru or abroad. Last week it acquired Lafarge’s Chilean cement unit for $555m. It may use the acquisition as an opportunity put some debt on its balance sheet in a departure from its historical strategy of paying for all of its purchases with cash, according to bankers following the company. “This is a big opportunity for the banks,” says one Andean region banker. Celfin Capital, which advised Brescia on its acquisition of Lafarge, is heard to have arranged for BancoEstado to provide the group with a $180m 2-year loan, which would then be taken out in the Chilean bond market, say local bankers away from the proposal. High quality corporate names have issued at up to 20 years in Chile. Brescia is heard to still be entertaining pitches from banks as to what to do with its balance sheet and new acquisition financing. It has apparently already paid for the Lafarge asset in cash, but could still choose to raise debt in its place. Brescia, whose investments are controlled by its AESA unit, is said to be hiring finance executives to prepare for a more active financial management of its assets. A Brescia spokesman didn’t return calls seeking comment.