GlaxoSmithKline (GSK) has acquired Argentina’s Laboratorios Phoenix for $253m in cash. The deal makes GSK the third largest pharmaceutical company in Argentina, the company says. A GSK spokeswoman says the company is looking to expand in EM, with LatAm being a priority. Phoenix, with 2009 sales of about $102m, is ranked eighth largest in Argentina’s pharmaceutical market, according to US-based healthcare intelligence company IMS. GSK Argentina made $82m in 2009 sales, making it the 14th biggest in Argentina’s pharmaceutical market. With this acquisition, GSK says it will gain a portfolio of branded generic pharmaceutical products covering therapeutic areas including cardiovascular, gastroenterology, metabolic and urology, as well as a manufacturing facility near Buenos Aires and Phoenix’s established primary care sales team. In addition, it will get an extensive pipeline of branded generics and product development capability in Argentina. Following the acquisition, GSK Argentina and Phoenix will stay as separate legal entities and Phoenix will retain its name, the buyer says. The GSK spokeswoman says that outside financial advisors were involved in the deal, but declines to name them. According to IMS data, GSK is the world’s fifth largest pharmaceutical company in the world, with 2009 sales of $35bn. The acquisition should not put a big dent in GSK’s balance sheet as it had about $9.6bn in cash at hand in 2009, up from $8.2bn the previous year, according to its own financial reports.
Category: Paywall
Brazilian Vies for Top I-Bank Spot
The investment bank fee pool is almost double last year’s haul and equity is generating a substantial portion, putting Itau in pole position to take the regional lead ahead of mostly US and European contenders. The bank has amassed $61m in revenue in the year to June 11, some 10% share of the total $614m wallet, Dealogic data show. By the same time last year, Itau was sixth, with $17m (5.3%), when the total LatAm revenue pool was $320m. Most of Itau’s income ($43m) comes from ECM, which the Brazil-based bank dominates with a 19.8% share. And Itau is the only top 3 bank by revenue to get global coordinator billing on the year’s biggest equity trade, a $25bn+ issue from Petrobras. Once that deal is done, Itau has a good chance of beating Credit Suisse, which sits atop the fees table for the year to June 11 with $82m (13.4%). Third-placed JPMorgan, with $49m (7.9%) credit so far, is the only bank in the top 3 with a coordinator role on a BRL10bn equity follow in from Banco do Brasil. The latter should boost the fees standing of fourth-placed Bank of America Merrill Lynch. Credit Suisse comes top for M&A fees year to date, with $27m (11.3%), and also leads DCM ($18m, 13.8%). This year should see further swelling of in the total regional fee pool, investment bankers say. However, the second half looks tough in terms of politics and contagion from global markets, highlighted by the European sovereign crisis. LatAm capital markets participants also bemoan the fact that besides heightened competition for deals – there are several new banks chasing LatAm league table credit – issuers are splitting fees between a greater number of underwriters.
Bimbo Outlook Rises
S&P has raised the outlook on Grupo Bimbo’s BBB mark to stable from negative, it says, following an earlier raise by Moody’s to positive. “The outlook revision reflects Bimbo’s adequate operating results during 2009 and first-quarter 2010, supported by the successful integration Weston Foods Inc.’s U.S. fresh bakery business last year, and relatively positive results in its Mexican operations,” the agency says, highlighting that total debt-to-EBITDA stood at 2.6x at March 31, down from 4.2x a year before. A level of 2.0x, plus a funds from operations-to-total debt ratio of more than 30%, would earn it an upgrade, S&P says, noting that this shouldn’t happen until the end of 2011. With an eye on possible liability management transaction this year, the Mexican breadmaker plans to meet with US and European investors next week.
Peru Raises Rates Again
Peru has raised its benchmark lending rate for a second straight month to cool inflation amid strong growth. The central bank increased its reference rate by 25bp to 1.75%, in line with forecasts. Bulltick predicts a total of 200bp in tightening this year, with the benchmark policy rate ending at 3.25%. Barclays anticipates Peru ending the year at 3.00%
Antigua Gets IMF Stand-By
The IMF says it has approved a $117.8m 3-year stand-by arrangement for Antigua & Barbuda to support efforts to restore fiscal and debt sustainability. Of the total, which is equivalent to 600% of the country’s quota, $24.5m is available for immediate disbursement. The bank says Antigua and Barbuda’s tourism-dependent economy has been severely impacted by global financial crisis. Declining tourism and FDI-related construction activities have triggered the worst recession in decades, contributing to a sharp decline in government revenue.
S&P Boosts Iansa, More Positive on Mabe
S&P has upgraded the ratings of Chilean sugar producer Iansa to B minus from CCC+. The outlook is positive. S&P cites the company’s improved financial flexibility and operating performance during the past 2 years and its successful $51m equity increase. “The positive outlook reflects our expectation that we could raise Iansa’s ratings if the company further strengthens its financial flexibility in 2010 and 2011. A reduction in debt position to near $100m by year-end 2010 coupled with a sound cash position would be consistent with the expected credit strengthening,” S&P says. Meanwhile, S&P has changed the outlook on the BBB minus ratings of Mexican household appliance company Controladora Mabe to stable from negative to reflect its improved financial performance and debt reduction and the agency’s expectation that this trend will continue. “In 1Q10, Mabe showed improvement in its sales volumes, trend that we expect to continue throughout the rest of the year, supported by positive growth prospects in Mexico and other key countries within the region, and consolidation of its Brazilian operations,” S&P says.
Hiring Strengthens in Brazil, Peru, Costa Rica
Globally, the strongest job prospects in the world are reported by employers in Brazil and Peru, among other countries, according to a Manpower employment outlook survey, which also sees strength in Costa Rica. “Regional hiring plans are strongest in Brazil, Peru and Costa Rica,” says the firm, referring to the Americas region. “Hiring plans again are stronger in comparison to third quarter of 2009 in all countries where year-over-year data is available and stronger in five countries quarter-over-quarter,” it adds. Manpower says employer optimism in the global labor market is gradually improving with employers in 30 of 36 countries and territories indicating stronger hiring plans compared to 12 months ago and 23 reporting improved quarter-over-quarter hiring plans. “Despite uncertainty in the European market, fewer employers are reporting negative forecasts for the quarter ahead,” it adds. Manpower also notes employers in China and Taiwan indicate their most robust hiring plans since the survey began in those markets in 2005. “Across the world, there is improved optimism towards hiring, which is typical for this phase of the recovery,” said Jeffrey A. Joerres, chairman and CEO of Manpower. “Foreign direct investment in Brazil is likely responsible for positive hiring sentiment in South America’s largest economy,” he adds.
Citi Loses Macia, Again
Little over 2 years after getting her back on the LatAm loans desk, Citi has again suffered the resignation of veteran loans banker Monica Macia. Macia, who rejoined Citi in April 2008 after a 1-year stint heading LatAm loans at UBS, is understood to be moving to a similar position at a competing bank, based in New York. Prior to UBS, Macia was at Citi for 14 years. Latterly, she was working in the loans sales and trading department. Citi is understood to have been hit dogged by defections in the LatAm department. Macia resigned earlier this week.
Itau Chile Sells Local Notes
The Chilean unit of Brazil’s Banco Itau issued UF1m ($39m) in 22-year notes. They priced at 102.11% with a coupon of 4.00% yielding 3.85%, a spread of 52bp over central bank notes. The bank’s brokerage managed the sale of the AA minus rated notes.
IBM, Santander Build in Brazil
IBM has opened a new global research laboratory in Brazil, its ninth to date and first in South America, while Santander is also investing in tech. “Lab personnel will begin operations immediately at existing IBM locations in Sao Paulo and Rio de Janeiro,” says IBM. The company aims to recruit more than 100 researchers, adding to a team of approximately 3,000 IBM researchers, in 8 labs, in 6 countries. “Brazil’s abundance of natural resources and technical talent presents unique research opportunities and the ability to deploy them to solve increasingly important problems,” says John Kelly, director of IBM Research. “The new lab also gives IBM scientists the opportunity to extend their collaboration with universities, government organizations, and companies in Brazil and across Latin America,” he adds. Research will focus on natural resource discovery, exploration and logistics, initially in oil and gas; semiconductors; and innovations to be used at the major sporting events Brazil will host, including the Soccer World Cup in 2014 and Olympic Games in 2016. Separately, Santander says it is investing BRL450m in a technology, research and data processing center in the city of Campinas in Sao Paulo state. Construction is expected to finish in 2012.