Mexican power company CFE is planning to issue up to MXP12bn ($899m) on September 19. The 30-year fixed transaction has a 15-year average life, according to selling memo. The state-owned utility could issue a maximum amount of up to MXP17bn, which falls under a MXP50bn program. The proceeds will be used to finance expenses related to the La Yesca hydroelectric power project. Banamex, BBVA Bancomer and Santander are managing the transaction, rated AAA.
Category: Bonds
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Fovissste Prices RMBS
Mexican government housing lender Fovissste has raised MXP4.8bn ($359m) through a domestic RMBS sale. The 2042 bond is denominated in UDIs and pays a fixed rate of 3.85%. BBVA Bancomer, Banorte-IXE and Santander managed the sale, rated AAA on a national scale. The government-backed lender last visited the market in June, raising MXP5.20bn in 2042 notes paying 4.30%.
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M&A Looks to Inter-regional Deals for Pickup
Asians, Americans and Europeans acquiring regional assets is likely to remain the dominant theme for M&A in Latin America for at least the remainder of the year, bankers say. “The pillars of what we’ve seen over the last few years continue to be valid, which is Brazilians consolidating the local markets, and foreigners moving into LatAm as a whole,” Jean-Marc Etlin, head of Itau BBA Investment Bank, tells LatinFinance. Private equity activity in the region is also a consistent driver, he says. Larger and cash-rich companies in LatAm looking beyond the region is still a less established trend. Bankers say the segment has barely scratched the surface of European divestures in LatAm, and there could be many more to follow. That said, there have also been some interesting additions – ranging from Spanish toll road operator Abertis to Dutch vitamin producer Royal DSM – by Europeans who can still afford to buy. “Buying in Europe is not as easy as people think. It is easier for Europeans to buy in Latin America,” Gerardo Mato, CEO of HSBC global banking, Americas, tells LatinFinance. “If you are cash rich, you are trying to buy companies at very acceptable multiples, and try to grow it from there. We are seeing Latin Americans interested in buying European assets, and what we are seeing is also a lot of Europeans reassessing whether to sell at current multiples.” The league tables, heavily influenced by AB Inbev’s $20bn purchase in July of a 50% stake in brewer Modelo, put Bank of America Merrill Lynch in the lead with $43.30bn from 20 deals through August 24, according to Dealogic. The US shop is followed by JPMorgan ($41.00bn from 26) and Lazard ($32.65bn from 15). BTG Pactual has earned the most revenue, with $75m, or 49% of the pool.
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Moody’s Rates BCI Notes
Banco de Credito e Inversiones’ (BCI) proposed 2017 global fixed rate senior notes have been rated A1 by Moody’s, with a stable outlook. The ratings agency says the A1 foreign currency senior unsecured debt rating takes into account the Chilean bank’s local currency rating and the notes’ seniority, as well as the bank’s own support structure.
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Aruba Preps Fixed-Income Meetings
The government of Aruba will meet fixed-income investors next week in Europe and the US, in a possibly prelude to a $253m, 11-year senior unsecured bond issue. Meetings will begin in London on September 3, followed by New York on September 4, Boston on September 5 and possibly Los Angeles on September 6. Fitch assigns the bonds a BBB rating with stable outlook. Proceeds will be used to address $88m in external maturities and to cover budgetary requirements, Fitch says. Credit Suisse and UBS are managing. Aruba last visited the bond market in February 2008, pricing a $57.3m 5-year issue.
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Bachoco Lands Tight MXP Debut
Mexican poultry producer Industrias Bachoco on Wednesday issued MXP1.5bn ($113m) in 5-year floating rate bonds, after seeing 2.3x in demand, according to a banker on the deal. The bonds priced at 60bp over TIIE, tight to the 70bp-area over TIIE guidance. Orders came from a diversified investor base including Afores, private banks, mutual funds and insurance companies. Proceeds will be used to refinance debt associated with the purchase of privately-held, Arkansas-based poultry producer OK Industries. Banamex led the transaction, rated AA+/AA.
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BCI Hits the Road
Chile’s Banco de Credito e Inversiones (BCI) plans to meet bond investors nest week in Latin America, Europe and the US. The A1/A-rated Chilean lender will see accounts in London and Lima, followed by visits to New York before wrapping up in Boston and Los Angeles on September 5. A 144A/RegS offering may follow subject to market conditions. Citi and JPMorgan are managing.
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Facileasing Prices MXP Bond
Mexico’s Facileasing has issued a MXP750m ($57m) bond in the domestic market. The 2-year floater priced at TIIE+75bp and represents the second issuance under a MXP10bn program. BBVA Bancomer and Bank of America Merrill Lynch managed the sale, rated AAA on a national scale. Facileasing previously priced a MXP500m 2015 at TIIE+70bp in February, marking the fleet leasing company’s first bond offering since being acquired by BBVA Bancomer.
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Ford Credit Looks to Issue
Ford Credit de Mexico will look to issue up to MXP2bn ($150m) in 2-year bonds, according to sources familiar with the auto finance services company’s plans. The issuance is part of an up to MXP8bn program. Bookrunners on the deal are Actinver, HSBC, Banorte-IXE and Scotiabank. In September of 2011, Ford Credit de Mexico sold MXP1bn in domestic floating-rate bonds. The 1.5-year deal priced at TIIE + 95bp, 5bp inside TIIE+100bp-area guidance.
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Sodimac Sells Bonds
Sodimac has sold COP300bn ($164m) in Colombia’s domestic market, in an issue that saw some 2.8x demand. The home improvement unit of Chilean retailer Falabella sold COP40bn in 5-year bonds at IPC+3.48%, COP190bn in 10-year bonds at IPC+3.88% and COP70bn in 5-year bonds at 6.47%. Bancolombia and Correval are managing the deal, rated AAA on a local scale.