Peru’s Pesquera Exalmar is expected to close a $140m 6-year loan next week, with a total of 7 banks heard likely to participate. The loan is offering a margin of Libor+390bp on the senior secured term loan. Leads are offering fees of 100bp for ticket sizes of $10m-$19.9m, 125bp for $20m-$20.9m and 150bp for $30m plus. There was also an early bird incentive fee of 15bp for institutions that participated within the first 2 weeks. The loan is secured by insurance policies and export receivables and proceeds are going to refinance debt, including a similarly structured $80m loan, as well as capex and working capital. The loan will be paid in 16 equal quarterly payments staring in year 2, with a final lump sum payment on maturity equal to 15% of the entire loan. The deal is being led HSBC, Santander and WestLB.
Category: Loans
Cemex Avoids Margin Step-Up
Mexico’s Cemex has made a $131m final prepayment under its 2009 financing agreement, allowing it to avoid a 50bp hike in interest expenses and saving it $37.5m annually, Maher Al-Haffar, the cement company’s VP of investor relations, tells LatinFinance. “We have done a lot of things in the first part of this year and last year to avoid step-ups,” he says. “We are comfortable, as our next maturity is not due until 25 months from now.” The company has now reduced the outstanding amount on the financing agreement by about $7.66bn – more than half of the original $15bn originally owed on bank loan. “This is definitely positive and gives us calm,” says Jerry Orosco, a Cemex bondholder and VP at Intercontinental Asset Management. Cemex 2020 bonds jumped a point yesterday to 68.5 on the back of the news. The company is expected to issue third quarter results next week.
CMPC Completes 10-Bank Syndication
Chile’s CMPC has closed a $600m 2-tranche loan syndication after luring 10 banks into the deal. The pulp and paper company secured $400m through a 5-year term loan with a margin of Libor+65bp, and a $200m through a revolver that will be available for 3 years. The company did not disclose pricing on the revolver, but bankers had been talking about a Libor+70bp margin after the deal had been launched earlier this year. Pricing had been seen as tight, but banks were keen to participate in what was a partial refinancing for a credit that is an infrequent issuer in the loan market. If drawn the revolver would amortize every 6 months starting in month 42, with the term loan carrying the same amortization structure. Bank of America Merrill Lynch, Bank of Tokyo Mitsubishi, EDC, JPMorgan and Scotia led the transaction, while Banco Santander-Chile, Citibank, Deutsche Bank, HSBC and Nordea Bank Finland also participated..
QG Seeks More Drillship Funding
Brazil’s Queiroz Galvao is heard mandating banks for an up to $1bn loan to finance the construction of two drillships to go on charter to Petrobras, but whether it will try its luck this year is open to debate given the shaky market backdrop. In July, Queiroz Galvao Oleo e Gas wrapped up a $700m 7-year, 3.8 average life bond, pricing it at 99.35 with a 5.25% coupon to yield 5.45% or 480.9bp over. Proceeds were used to refinance a loan used to fund Atlantic Star and Alaskan Star drillships. HSBC and Santander acted as global coordinators on the sale, with Citi coming in as a bookrunner.
Banks Fund Brazil Fertilizer Project
The IFC, BNDES and Itau have agreed to a $158m equivalent A-B loan supporting Toronto-based MBAC Fertilizer’s Itafos-Arraias phosphate and fertilizer project. The IFC is to provide a $40m 8-year project finance facility. It pays a spread to Libor that the IFC declines to disclose. BNDES will provide BRL205m passed through Itau, splitting that amount into credit lines valued at BRL11.5m and BRL193.5m. BNDES and Itau did not respond to requests for comment on the facilities’ details. Proceeds will help fund the development of a phosphate mine along with the Itafos fertilizer plant.
Curitiba Metro Gets State Funds
The Brazilian city of Curitiba has obtained BRL1.75bn to help fund a BRL2.25bn (U$1.29bn) metro line project. The expansion is the largest project in the city’s history, and is part of the federal government’s PAC growth acceleration plan. The package includes a BRL1bn grant and a BRL750m loan from BNDES. The terms of the loan are still being negotiated, says a city spokeswoman. The Parana state government will also give a BRL300m grant, while seeking BRL200m through PPP deals with the city government.
Codelco Borrows from Offtaker for M&A
Taking the unusual step of turning to an offtaker for financing rather than banks, Codelco has agreed to a standby bridge loan of up to $6.75bn from Japan’s Mitsui and Co., to help fund the Chilean state-owned miner’s possible purchase of up to 49% of the Anglo Sur mining complex. Codelco has an option to buy the position in the Chilean complex, owned by Anglo American, and this can be exercised beginning in January. Codelco says it values the stake at $9.76bn. Once the loan is disbursed, the credit would have a tenor of up to 12 months. If not repaid with cash or 50% of Codelco’s Anglo Sur equity interest at the end of the 12 months, the debt would automatically be converted into a 5-year term loan. Company officials did not respond to requests to comment on the interest rate. The option to acquire the 49% stake had previously been held by fellow Chilean state mining company Empresa Nacional de La Minera, which sold it to Codelco for $175m. The option comes up every 3 years and expires in 2027. The bridge financing arrangement comes as Codelco and Mitsui announce an offtake agreement for 30,000 tons of copper per year subject to market based pricing terms. Anglo Sur includes the Los Bronces and El Soldado mines, the Chagres smelter and the Los Sulfatos and San Enrique Monolito prospects.
Renova Gets BNDES Loan
BNDES has approved a BRL297m ($162m) loan for Brazil’s Renova Energia, to support the construction of 5 wind farms in the state of Bahia. The 18-year loan pays the TJLP plus 0.9% and an additional risk premium that BNDES officials decline to disclose. The 5 farms are part of a 14 farm complex, with the first 9 receiving funding in 2010. Pedro Pileggi, Renova’s director of investor relations and new business, said the cost was in line with the previous projects and that the BNDES financing is key to the wind farms’ capital structure. However, he notes that commercial banks are expected to become more and more interested in wind energy projects. Renova is also expected to continue investing in the expansion of its renewals portfolio.
Odebrecht Sees 7 on FPSO Financing
Brazilian construction and engineering firm Odebrecht has a total of 7 banks on board its $300m 10-year loan to finance the conversion of a floating production, storage and offloading (FPSO) unit. Sumitomo and Societe Generale are leads, and another 5 banks are heard committing. The unit is being converted in Singapore and is expected to be ready early next year.
OSX Nears Finish Line
Five banks are heard signing up for OSX’s $850m loan to finance the construction of a floating production storage and offloading (FPSO) vessel OSX-2 in Singapore. The transaction is expected to close in October and is being led by ING, Itau and Santander. The loan has a 12-year final maturity with a 7-year average life, offering a margin L+425bp pre-construction and +410bp thereafter. Including the bookrunners, the deal now has 8 banks in total. This comes despite difficulties earlier this year when some banks were heard giving the transaction a wide berth amid euro-zone worries and higher funding costs. Bankers also expressed concerns over how the company, controlled by Brazilian magnate Eike Batista, lacked a track record. Against this backdrop, leads were forced to flex pricing up to L+425bp from 375bp pre-construction and to +400bp from 360bp thereafter.