Chile’s Aguas Andinas will consider issuing bonds in Chile’s domestic market early in 2014, according to people familiar with the issuer’s plans. The water utility is in the process of registering a program of up to UF6m ($270m) at up to 30 years, and expects to complete registration by the end of the year. The first transaction would likely be for less than UF6m. Andinas last visited the market in April, issuing UF2m in 3.8% 2036 domestic bonds at a 3.8% yield, or 123bp wide of the government benchmark. Santander managed that deal, rated AA+/AA+ on a national scale.
Category: Chile
Posted inDaily Brief
Chilean Miner Clinches Copper PF Funds
Antofagasta Minerals has agreed to a $650m financing package that will help fund the Antucoya copper project, the Chilean mining company says in a statement. Banks participating in the financing are the Japan Bank for International Cooperation (JBIC), Export Development Canada (EDC), KfW IPEX-Bank, Mizuho, Sumitomo Mitsui, Natixis and ING, along with Chilean banks Corpbanca and Banco del Estado. The borrower does not give additional details on the breakdown, pricing or maturity. Marubeni holds a 30% stake in the project, joining in 2011 when the estimated capital cost was $1.3bn. Antucoya is slated to start production in 2015, and should produce 80,000 tons of copper cathodes per year.
Posted inDaily Brief
Airline Sees Strong Bid for ABS
Chile’s Latam Airlines received $2.7bn demand for a $450m securitization of airline ticket payment flows, according to people familiar with the transaction. The 2020 ABS backed by USD and CAD-denominated receivables from ticket and cargo sales in the US and Canada priced at par with a 6.00% coupon, tight to 6.25%-area guidance and earlier mid-6% talk. The bond traded up 0.50-1.40 points Monday afternoon, according to a trader. Comping the BB+/BBB minus credit was difficult, though leads were said to target pricing inside of Colombian Avianca’s unsecured 2020 bond, trading to yield 7.25% Monday. The Latam bond will have a 2-year interest-only period followed by five years of amortizations. Citi and Bank of America Merrill Lynch managed the deal, issued through the Guanay Finance Limited SPV and rated BB+/BBB minus. The deal follows a June $133m 2024 structured deal, guaranteed by the UK’s Export Credit Guarantee Department (ECGD), priced to yield 2.581%, or MS+100bp.
Posted inDaily Brief
Chilean Wraps up Roadshow
Latam Airlines has ended its investor meetings, and is preparing to price a new $450m asset-backed bond as soon as Monday, say people familiar with the issuer’s plans. The 2020 bond is backed by airline ticket and cargo payment flows, according to Fitch, which assigns a BB+ rating. The Chilean visited Santiago, Lima, Los Angeles, London, Boston, Hartford and New York. Citi and Bank of America Merrill Lynch are managing the deal, to be issued through the Guanay Finance Limited special purpose vehicle. The bonds are backed by USD and CAD-denominated receivables from ticket and cargo sales generated by credit, debit or charge cards in the United States and Canada. The bond will have a 2-year interest-only period followed by five years of amortizations. In June, Latam priced a 2024 bond guaranteed by the UK’s Export Credit Guarantee Department (ECGD), raising $133m. The 6.05-year average life note priced to yield 2.581%, equal to MS+100bp, through BNP Paribas and Santander.
Posted inMagazine
Bank of the Year, Chile: Banco Corpbanca
Ratings agencies may have frowned on Corpbanca’s Colombian acquisitions, but with a strong financial set-up, the bank is confident it has a formula for success, its chief executive says
Posted inMagazine
Investment Bank of the Year, Chile: BTG Pactual Chile
With its cross-LatAm credentials firmly in place, the firm formerly known as Celfin is keen to grow its investment banking reach
Posted inDaily Brief
Copper Company Seeks Project Funds
Canadian copper processor Amerigo Resources, through its Chilean subsidiary Minera Valle Central, is working with BBVA to structure loan financing for a $140m plant expansion, it says. The expansion will be majority funded by the loan, and the remainder by internal cash flow, say people familiar with the process. Syndication is expected early next year, as the copper tailings processor is still awaiting the necessary environmental approvals that will allow it to move ahead. Banks have already expressed interest in being part of the loan transaction, which is likely to have a term of 7-10 years with early repayment provisions, according to a person familiar with the matter.
Posted inDaily Brief
Water Utility Readies Return to Chilean DCM
Chile’s Aguas Andinas is in the process of registering a domestic bond shelf of up to UF6m ($273m), for maturities of up to 30 years. Additional details are not yet available. The water utility last visited the market in April, issuing UF2m in 3.8% 2036 domestic bonds at a 3.8% yield, or 123bp wide to the government benchmark. Santander managed that deal, rated AA+/AA+ on a national scale.
Posted inDaily Brief
Fitch Chops Alsacia
Fitch has downgraded Inversiones Alsacia’s rating to CC from B, it says, based on a “heightened risk of default.” The Santiago bus operator’s Ebitda continues to shrink while debt service increases in accordance with the original amortization schedule. The agency also finds it will be difficult for the Chilean company to keep debt reserve accounts and maintenance accounts funded. “The operating contract amendment of May 2012 heightened the project’s risk profile by significantly increasing the linkage between passenger demand and revenue levels,” Fitch says, noting demand below expectations during the last two years. Alsacia has been hurt by a new concession contract that is less favorable than its previous agreement, resulting in higher costs and strained financial metrics. Holders granted Alsacia covenant debt service and account waivers earlier this month. Alsacia is now at CC/Caa2, after also seeing Moody’s downgrade earlier in the month.
Posted inDaily Brief
BCI Taps Local Subordinated Debt
Chile’s Banco de Credito e Inversiones (BCI) has sold UF2m ($91m) in 30-year subordinated bonds, according to the Santiago Bolsa. The 2043 priced at a discount with a 2.60% coupon to yield 3.96%, or government bonds plus 144bp. BCI managed the sale, rated AA/AA minus on a national scale. The bank has a UF15m, 30-year program registered in Chile’s local market.