Colombia’s Grupo Argos is expected to issue COP500bn ($274m) in convertible bonds in a process starting today and expected to price Wednesday, say sources familiar with the Colombian conglomerate’s plans. The sale may be upsized to COP750bn. The 3-year bond comes with a 5.0% coupon and is convertible into preferred shares at the holder’s discretion during the life of the bond, and mandatorily at maturity. Bancolombia is leading the deal, rated AA+ on a national scale, with Bolsa y Renta, Corredores Asociados, Correval and Serfinco as bookrunners. In a research report, Bolsa y Renta highlights the papers as a medium-term play for investors that is ideally held to maturity.
Category: Equity
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Banco de Chile Sets FO Price
Banco de Chile is targeting CLP252.2bn ($524m) through an equity capital raise, with a rights offering to existing holders scheduled to begin December 5. The bank has set the price for the 3.94bn shares at CLP64 each. Shares closed at CLP70.69 Monday. Some 2.66bn shares will be available during the subscription period for existing holders, which runs through January 3. The bank, controlled by the Luksic family and Citi, is raising funds for expansion.
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BB Looks to Spin off Insurance Arm
Banco do Brasil is planning to put its insurance operations into a new company that may IPO next year, it says. The state-controlled bank is seeking to consolidate its insurance businesses into a single company, BB Seguridade, to lower costs, increase scale and be better prepared for possible expansion. BB Seguridade would control Banco do Brasil’s two insurance joint ventures with Madrid-based Mapfre, and the bank plans to also expand into dental and health insurance brokerages. The listed company would directly control two holdcos, one responsible for insurance brokerage activities and the other for all other insurance operations. It does not give any additional details about the possible IPO, other than that the sale would include both primary and secondary shares. Banco do Brasil is Brazil’s largest bank, and its insurance operation number two behind Bradesco’s.
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Macquarie Launches Fibra
Macquarie aims to raise more than $1bn in Mexico’s Fibra market through a transaction pricing December 6, according to regulatory documents. The Mexican arm of the Australian asset manager would raise MXP16.13bn ($1.2bn) if the 597.4m-share deal prices at the midpoint of a MXP25.00-MXP29.00 range and a 15% greenshoe is included. Macquarie is planning to put real estate assets into a fund to be capitalized through the REIT-like transaction, and use proceeds to acquire additional properties. The Macquarie Mexico Real Estate Unit already counts properties in 15 Mexican states. Bank of America Merrill Lynch, BBVA, JPMorgan and Morgan Stanley are managing the transaction, which is part of a wave of recent deals being prepared in the asset class. Grupo GDI, scheduled to price Thursday, and Hoteles Prisma are both preparing hotel-focused Fibras. Issuers are spurred on both by a successful follow-on earlier this year from Fibra Uno, still the only completed Fibra, as well as optimism for Mexico’s economic development in the next few years, which will have particular advantages for the real estate sector.
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Alsea Sets FO Timing
Mexico’s Alsea plans to hold an equity follow-on November 29, according to people familiar with the process, after initially targeting the following week. The food and beverage franchise operator plans to sell 58m shares, including a 15% greenshoe, in local and international tranches. This would indicate a MXP1.18bn ($90m) total size based on Tuesday’s MXP20.43 closing price. The issuer plans to use proceeds to repay debt to improve its capital structure as it continues to expand. Banamex and Santander are managing. Alsea is known as the operator for brands such as Starbucks, Dominos Pizza and Burger King in Mexico and in other markets. Company officials recently announced a $110m plan to expand the Starbucks brand in Mexico and Argentina.
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Cemex Defines Clean Energy CCD
A renewable energy-focused certificado de capital de desarrollo (CCD) transaction backed by Cemex is targeting up to MXP4bn ($306m), according to regulatory documents. The Capital en Proyectos de Energia vehicle is to create a 10-year fund investing in clean energy generation in Mexico. The return structure is one typical of CCDs, with investors receiving initial capital plus a preferred return of up to 10%, followed by distributions 80% to investors and 20% to the managers. Santander is managing the transaction, with Evercore as structuring agent. The timing is unclear, with most CCDs pricing several months following the initial filing.
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Cencosud Advances Equity Raise
Shareholders of Cencosud have approved a $1.5bn equity capital increase, the Chilean retailer says, part of a plan to pay for its recently announced purchase of Carrefour’s Colombian assets. In the process, the controlling Paulmann family plans to exercise its rights, meaning there will be much less than the total amount available for the general market. The increase should take place in late December or January. Cencosud is also preparing a $1bn cross-border bond sale to fund the acquisition. At the time of purchase, the retail secured a $2.6bn bridge loan from JPMorgan, which is now being syndicated. The facility, for up to 18 months, is heard counting on participation from Bank of Tokyo-Mitsubishi, BBVA, BNP, Itau, Mizuho and Santander. The deal for Carrefour’s Colombia operations gives the Chilean 18% of the country’s supermarket sector.
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Alupar Files IPO
Brazil’s Alupar has registered for an IPO, according to regulatory documents. The holding company for electric transmission and generation operations, familiar to Brazil’s domestic debt markets, is still mum on the size of the deal. The sale is to include units consisting of one ordinary share and two preferred shares. The timing also remains unclear. Alupar booked BRL694m in Ebitda during the first nine months of this year, up from BRL568m in the corresponding period of 2011, and following BRL762m in all of 2011. The issuer is raising funds to be used mostly for obtaining and developing new concessions, and about 20% for acquisitions. BTG Pactual, Credit Suisse, Goldman Sachs, Itau and Santander are managing the deal.
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US Real Estate Investor Plans CCD
LaSalle Investment management is preparing a MXP4.2bn ($321m) Certificado de Capital de Desarrollo (CCD) transaction in Mexico’s local market. The US real estate investment specialist is looking to create a fund investing in Mexican real estate assets, including office, commercial, industrial and residential properties, according to regulatory documents. The CCD is to be accompanied by a $15m parallel investment. LaSalle, who has invested more than $600m in Mexico through six previous private vehicles, is targeting a 16%-20% return. The plan includes a 4-year investment horizon, and doesn’t specify an expected total number of years, though CCDs typically have a 10-year maturity. BBVA Bancomer is managing the transaction.
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Saba to Delist In US
Mexico’s Grupo Casa Saba plans to delist its US ADS, it says. The pharmaceutical distributor takes into account low trading volumes in the ADS, as well as difficulties that its recent acquisitions have caused in its financial reporting. It intends to request the move from the SEC next week, with the delisting following 10 days from approval. Its shares will continue to be traded on the Mexican Bolsa.