BBVA Bancomer, the Mexican unit of Spanish banking giant BBVA, has registered with Mexico’s national banking and securities commission (CNBV) to issue up to $1.84 billion worth of local debt securities (20 billion pesos) in a program over the next two years. The nominal value and maturity of the debt securities will be determined for every issuance within the program. Casa de Bolsa BBVA Bancomer will act as placing agents. The bank has published a preliminary prospectus.
Category: Corporate & Sovereign Strategy
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Ternium To Invest $1.4 Billion In Latin America
Luxembourg-based flat steelmaker Ternium, owned by Argentina’s Techint, is to invest $1.4 billion over the next three years in its Latin American operations. The company has steel operations in Argentina (Siderar), Mexico (Hylsamex) and Venezuela (Sidor) with a combined annual production capacity of 10.8 million tonnes. The company plans to increase capacity up to 12 million tonnes before 2009.
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BNDES To Issue Debentures
Brazil’s National Development Bank (BNDES) has filed with the country’s securities market regulator (CVM) to issue debentures via its investment unit BNDESPar. The Bank said it would issue at least $226 million worth of the local non-convertible bonds. The bonds will carry a maturity of six years and will pay an annual interest rate of IPCA plus 6%. In total, the Bank plans to issue $900 million worth of the paper over the next two years. This issuance would represent the first tranche in that program.
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Brazilian Regulator Turns Down Steel Appeal
Brazilian securities regulator (CVM) has turned down an appeal by Netherlands-based Mittal Steel and upheld a ruling that it must offer to buy out minority shareholders of Brazilian steel company Arcelor, which Mittal bought as part of its merger with rival Luxembourg-based steelmaker Arcelor. The ruling will add up to $4 billion to the cost of the $38.3 billion merger, according to Mittal which had appealed the decision last month on the basis that the merger is one of equals and not a takeover. The latest ruling is final unless Mittal and Arcelor Brasil appeal to Brazil’s federal court.
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Investor Jitters On Ecuador Debt Restructuring
International bond investors are feeling increasingly jittery amid growing signs that Ecuador may opt to restructure its foreign-currency debt. Incumbent president, Alfredo Palacio, has spoken of “debt renegotiation” while frontrunner presidential candidates, León Roldós and Rafael Correa have both mentioned debt restructuring with Correa commenting that he has not discarded the possibility of an Argentina-style debt default. Ecuador defaulted on $6.5 billion of debt in 1999. It currently has about $1 billion of dollar-denominated bonds due to mature in the next 12 months.
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Satmex Restructuring Gets US Approval
Judge Robert Drain of the bankruptcy court of the Southern District of New York has approved the reorganization plan presented by Mexican satellite operator Satélites Mexicanos (Satmex) in August. The restructuring plan has been agreed by at least two-thirds of the company’s creditors and is the final stage of the company’s reorganization following the conclusion of its bankruptcy proceedings in Mexico at the end of July. The underlying bankruptcy agreement lays out that debt will be reduced from around $600 million, including interest, to $375 million, plus capitalization of between $335 million and $350 million, of which $60 million will become working capital. High-yield bonds will account for 80% of total shares and 45% of voting shares; the government will hold 20% of total shares and 55% of voting shares. Non-guaranteed debtholders will swap their debt for shares in the company.
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Tenaris Agrees Sale Of 75% Dalmine Energie
Luxembourg-based Tenaris, the world’s largest steel tube producer, controlled by Argentina’s Techint, is to sell 75% of its stake in Italian energy provider Dalmine Energie to German energy sales company E.ON Sales and Trading for $50 million. Dalmine Energie is valued at $92 million. Dalmine Energie specializes in distributing electricity and natural gas to industrial and commercial clients in Italy.
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Gol Pulls Share Offering
Low-cost Brazilian airline Gol has pulled its planned share offering, without offering an explanation. In May, Gol filed an application with securities regulator CVM to make a public offering of shares to domestic and foreign investors. Gol had planned to issue 2.5 billion of new, non-voting shares, as well as making a secondary offering of 14 billion preferred shares, worth around $460 million.
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Alsea Gets Credit For Restructuring
Alsea, Mexico’s largest food retailer, has secured a loan worth $41.4 million (450 million pesos) from BBVA Bancomer. The money is to be used to refinance debt, in particular short-term obligations, and extend out its debt profile. The composition of the company’s debt is currently 95% short term and only 5% long term. It plans to restructure this so that only 15% has a short tenor and 85% has long-term maturities. Alsea also has operations in Argentina, Brazil and Chile.
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Fitch Upgrades Peru
Ratings agency Fitch has upgraded the foreign currency issuer default rating (IDR) of Peru to BB+ from BB with a stable outlook. Strong export growth, rising tax revenues, combined with government spending restraint in the first half of the year were all factors that contributed towards the Agency’s decision to upgrade the sovereign. “Furthermore, the smooth political transition that took place in July supports the upgrade, with President Alan Garcia’s inaugural speech and cabinet appointments pointing toward a continuity of the macroeconomic policies that have served Peru so well in recent years”, commented Fitch.