The Central American Bottling Corporation (Cabcorp) is out with guidance of 7.75% area on a $150m 10-year bond, with pricing expected today. The Guatemala-based anchor bottler for Pepsi in Central America was to wrap up roadshows in New York yesterday via sole lead Citi, marketing senior guaranteed notes rated Ba2/BB/BB+. Cabcorp is controlled by the Castillo family, with Pepsico holding an 18% stake. Cabcorp expanded into the Caribbean in 2009 when it bought PepsiAmericas and its territories in Puerto Rico, Jamaica and Trinidad. As of September 30, 2011, short-term maturities only amounted to $19m, versus $85m of cash on hand, according to Moody’s.
Category: Central America
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Cabei Preps MXP Issue
Central American development bank Cabei is looking to issue up to MXN1.5bn ($155m) in the Mexican domestic bond market this week. The 3-year bonds will pay a spread over TIIE, with pricing scheduled for Thursday. Cabei last came to the Mexican domestic market in September 2010, when it raised MXP700m through the sale of 2020 bonds, pricing at TIIE+65bp. Banamex led the previous sale, and is also managing this week’s issuance, rated AAA on a national scale.
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Cabcorp Starts Investor Meetings
The Central American Bottling Corporation (Cabcorp) launched investor meetings Thursday in London and Santiago, and will head to Boston, Los Angeles and the US West Coast before finishing in New York on Wednesday. The Guatemala-based anchor bottler for Pepsi in Central America has been heard looking to raise $150m in the international bond markets. Citi is sole manager on the possible deal, rated Ba2/BB/BB+. Cabcorp is controlled by the Castillo family, with Pepsico holding an 18% stake. Cabcorp expanded into the Caribbean in 2009 when it bought PepsiAmericas and its territories in Puerto Rico, Jamaica and Trinidad. As of September 30, 2011, short-term maturities only amounted to $19m, versus $85m of cash on hand, according to Moody’s.
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Citi Heard Clinching Cabcorp Bond Mandate
The Central American Bottling Corporation (Cabcorp) is heard mandating Citi as it looks to raise an expected $150m in the international bond markets. This comes as Moody’s assigns a Ba2 rating for the proposed senior unsecured fixed-rate global note after reviewing a preliminary draft of the legal documentation for the offering. The Guatemala-based anchor bottler for PepsiCo in Central America is controlled by the Castillo family, with Pepsico holding an 18% stake. Pepsico’s involvement is seen as credit positive, but the ratings are constrained by its comparatively modest profits against global peers and the company’s strategy to pursue acquisitions on a regular basis, the agency says. Cabcorp expanded into the Caribbean in 2009 when it bought PepsiAmericas and its territories in Puerto Rico, Jamaica and Trinidad. As of September 30, 2011, short-term maturities only amounted to $19m, versus $85m of cash on hand, according to Moody’s.
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Cabei Poised to Close Loan
The Central American Bank for Economic Integration (Cabei) is poised to close a $100m 3.5-year dual-currency loan this week through MLAs and bookrunners Mizuho and HSBC. The 3.5-year bullet loan is split into a $40m-equivalent yen tranche and a $60m dollar portion. Five Asian banks are heard to be participating on a loan that comes with an all-in margin of around Libor+160bp.
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CABEI Brings Triple-Market Bond
The Central American Bank for Economic Integration (CABEI) has placed $67.6m 10-year bond into three Central American markets, marking the first time a borrower has simultaneously registered and sold debt in three of the isthmus’s countries. The 2021 bond priced at par and offered buyers in Panama Costa Rica and El Salvador a coupon that steps up from 2% to 3% after year two, to 4% in year five and to 6% in year seven. Yield to call and yield to maturity for the $67.6m bond came in at 2.6% and 4.3%, respectively. The bonds are callable after 4.5 years. The development bank issued $31.6m in Costa Rica, $22m in El Salvador and $14m in Panama. Local pension funds and banks were the main investors. The multilateral bank’s issuance represents the first time a bond has been simultaneously registered and sold in three local capital markets in the region. Citi led the transaction, rated AAA locally in Costa Rica and El Salvador. A local rating in Panama was not required.
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Banks Prepare For Guatemala RFP
Bankers are heading to Guatemala to pitch public credit on expectations that the sovereign will soon issue RFPs to refinance its maturing $325m 10.25% bond due November 2011. “It is not clear whether it will be a local or international [bond],” said one banker. “We expect that they would take advantage of low rates [in the international markets] and be interested in maintaining an international investor base by going external.”
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Bco Industrial Puts Tier II to Bed
Guatemala’s Banco Industrial priced Wednesday a US$150m 10-year subordinated Tier 2 bond (Ba2/BB) at par to yield 8.25%, coming flat to earlier 8.25% area guidance and at the tight end of low-to-mid 8 whispers. Considered Guatemala’s largest bank, the sub investment grade credit had originally been seeking between $150m-$250m, but capped the deal at the lower end of that range as only $150m could qualify as Tier 2 capital. The bond jumped on the break to trade at 100.75-101.25. While difficult to comp to investment-grade Tier 2 bank issuers that have recently come to market, investors looked at the sovereign, with the deal coming at a quarter point concession to government paper, according to one participating investor. The 144/Reg S notes are secured by a subordinated loan from Bank of America to Banco Industrial, Fitch says. The US bank is transferring its rights to the loan to a trust, which in turn pledges the loan as collateral. Uses of proceeds are slated to repay subordinated debt and to strengthen regulatory capital. The notes are governed by New York law. Banco Industrial was brought to market by sole lead BAML. The issuer last came to market in 2008 when it priced a $30m 60-year NC10 priced at par to yield 9% through Credit Suisse.
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Bco Industrial Whispers On 10-Year
Whispers on Guatemala’s Banco Industrial were being heard at low to mid 8s Tuesday on a $150m-$200m 10-year Tier 2 bond, with pricing expected as soon as today. The lender wrapped up roadshows last week with Bank of America Merrill Lynch. The notes are secured by a subordinated loan from Bank of America to Banco Industrial, according to Fitch which has assigned an expected BB- rating to the offering. The US bank is transferring its rights to the loan to a trust, which in turn pledges the loan as collateral. Considered Guatemala’s largest bank, Banco Industrial has a Baa3 local and Ba2 foreign currency rating from Moody’s. The company’s last foray into the debt capital markets was a $30m 60-year NC10 priced at par to yield 9% in 2008 through Credit Suisse.
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CentAm Needs $13bn in Energy Project Financing
Central America will need an estimated $13bn to finance 7,000MW of generation capacity by 2015, according to Hector Rodriguez, coordinator of ARECA, a renewable energy project supported by development bank Cabei. As a result, many countries in the region are slashing taxes and import fees relating to renewable energy projects. The region is looking to satisfy an average annual increase in electricity demand of 6% over the last quarter century. Honduras, for example, passed a law that eliminated all taxes and tariffs on the purchase of materials and services for renewable energy projects, and provides a financial incentive worth 10% of the base price of electricity. “That was definitely part of the motivation in creating our wind project,” Jay Gallegos, CEO of MesoAmerica Energy, tells LatinFinance. The company’s wind energy project, Energia Eolica de Honduras, began operations in June and will generate 102MW. The project cost $260m and was financed primarily by Globeleq Generation. The country plans to build 21 new energy projects, including five large hydroelectric projects with investment price tags ranging from $110m-$700m. Panama, meanwhile, plans to add 22 renewable energy projects over the next four years, adding 1,061MW to its system at a cost of $4.37bn. Italy-based ENEL, Europe’s largest energy provider, has projects in five Central American nations and, according to Francesco Starace, CEO of ENEL Green Power, plans to expand further.