Spain’s Gas Natural Fenosa has agreed to sell its positions in two Nicaraguan electricity distribution assets to TSK-Melfosur for $57.8m, it says. The deal includes an 83.7% position in Electricidad del Norte and an 83.7% position in Distribuidora del Sur. The buyer is a local entity owned by Spanish engineers TSK and Melfosur. Gas Natural does not expect the deal to have a significant impact on its finances.
Category: M&A
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Investor Group Adds to Aeromexico Position
An investor group led by Grupo Lala chairman Eduardo Tricio Haro has bought an 18.5% position in Aeromexico from Banamex, taking its holding to 20.2%, the airline says. The sale came at MXP16.50 per share, implying a MXP2.19bn ($172m) value, based on Aeromexico’s 717m shares outstanding as of year-end. Banamex now holds 16.1% of the airline. Tricio Haro has been an investor in Aeromexico since 2007 and following Tuesday’s transaction is to become chairman of the board.
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Abril Picks Up English School
Abril Educacao, the education arm of Brazilian media conglomerate Grupo Abril, has acquired Brazilian English school Wise Up, it says, for BRL877m ($445m). The amount, subject to final adjustments, is to be paid in installments. Abril will pay BRL221m immediately, and BRL133m in year four and BRL133m in year five, acquiring 56.7% of Wise Up. This will be funded using a BRL280m 5-year revolver. The remaining 43.3% is to be paid through the issuance of 8.1m units of Abril, implying a BRL48.15 per unit price. The units closed at BRL48.00 each Friday. BTG Pactual is heard advising the target. Abril officials were unable to be reached for additional comment on the deal. Founded in 1995, Wise up has 338 franchise schools throughout Brazil.
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Alicorp Adds in Brazil
Peru’s Alicorp has added to its presence in Brazil, agreeing to acquire pasta maker Pastificio Santa Amalia for BRL190m ($96m), it says. The move is part of a continued international expansion that also includes Argentina, Chile, Colombia and Ecuador. Santa Amalia specializes in pasta, chocolate, powdered beverages and other products, and took in BRL573m revenue in the last 12 months. Additional details were not available. Alicorp is considering what would be its inaugural bond issue in the international markets this year, according to DCM sources.
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Millicom, EPM Close to Phone Tie-up
Millicom International Cellular has entered into exclusive negotiations with Empresas Publicas de Medellin (EPM) regarding the possible combination of their Colombian telecom operations, the companies say. No value has been announced for the deal. The pair have partnered for six years. City-owned EPM controls cable and telephony provider UNE EPM Telecomunicaciones, which in turn owns 25% of Colombia Movil. Colombia Movil operates the Tigo brand and is majority owned by Millicom. A more complete combination is being driven by UNE’s move into offering mobile service, which the pair say they would like to better integrate with the fixed telephony. An agreement would involve a shareholder agreement similar to one in place now bwtween the two. Fixed-mobile integration is also what drove Colombia Telecomunicaciones and Telefonica Moviles Colombia to merge last year. The discussions are expected to conclude during the first half of 2013.
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BBVA Exits Chilean Pension
MetLife and BBVA have put terms on the anticipated sale of the Spaniard’s AFP Provida Chilean pension unit to the American insurer, with the $2bn value generally seen as fair. In the deal, BBVA has agreed to sell its 64.3% of Provida for $1.52bn, and MetLife will tender publicly for the remainder, the two parties say. MetLife will offer holders $6.04 per share for each of the 118m shares making up the public float. Provida holders can also expect another $365m in dividends as a result of the sale. Overall the valuation is seen as fair, and lower than other recent deals in the sector. “The purchase of Provida will enhance MetLife’s business mix by increasing its exposure to faster-growing and higher-return emerging markets,” JPMorgan says in a report, calling the deal “fair” and a “strategic positive.” The shop finds that the deal values Provida at 4.4% of AUM and 11x 12-month earnings. This compares to the 4.7% of AUM and 13x earnings that Prudential Financial paid for AFP Cuprum last year in a $1.5bn transaction, the most recent previous sale of a Chilean pension. BBVA was seen selling its Mexican pension at around 14.5x in October, and selling its Colombian unit at around 13.5x in January. The US insurer says it expects to boost its earnings from EM to 17%, from 14%. As part of a shift to less capital intensive products, MetLife says the deal should be immediately accretive to earnings, at approximately $0.05 per share in 2013 and $0.15 per share in 2014. BBVA expects a EUR500m ($685m) post-tax gain from the sale. The transaction also includes a small asset management business in Ecuador. MetLife is paying cash. BBVA has sought buyers for its pension-fund assets in Chile, Mexico, Peru and Colombia since May of last year. It agreed in November to sell the Mexican operation to Banorte for $1.6bn and the Colombian operation to Grupo Aval in January for $530m. Its Peruvian business remains on the block. Bank of America Merrill Lynch and law firms Sakdden Arps and Prie
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Brazilians in Pharma Tie-up
Brazil’s Profarma Distribuidora de Produtos Farmaceuticos has agreed to buy 50% of peer Drogarias Tamoio for BRL105m ($53m), it says. The pharmaceutical retailer says the deal comes at a multiple of 7.5x EV/2013 Ebitda. Rio de Janeiro-based Tamoio specializes in medicine, personal hygiene products and beauty products, and booked BRL312m in revenue last year. The transaction is subject to regulatory approval.
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Regulator Challenges Modelo Sale
The US Department of Justice has filed suit to block the $20bn acquisition of 50% of Mexican brewer Grupo Modelo agreed last year, buyer AB Inbev says. The challenge to the deal – LatAm’s biggest announced M&A transaction in 2012 – is mainly based on AB Inbev’s ability to charge consumers more if it controls both the Corona and Budweiser brands, two of the most popular in the US market. At the very least, it is a setback to the parties’ original plans to close the deal by the end of March. After four years of AB Inbev owning an initial 50% of Modelo and long discussions for the other half, the two sides agreed on the deal in July. Morgan Stanley advised Modelo, while Deutsche Bank, Lazard, Barclays, JPMorgan and Bank of America Merrill Lynch advised AB InBev. The move is “inconsistent with the law, the facts and the reality of the market place,” AB Inbev says, vowing to contest the action while noting that closing should be delayed.
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BTG Buys Troubled Bank
BTG Pactual has agreed to acquire Banco Bamerindus do Brasil, it says, paying BRL418m ($210m) to the FGC deposit guarantee fund. The deal gives BTG 98% of the liquidated bank’s remaining assets. The deal includes debt, but excludes the bank’s brand name. The payments are to be made in five annual installments.
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MetLife Negotiating with BBVA for Chile Pension
MetLife is in talks with BBVA to buy the AFP Provida pension business in Chile, it says. The timing of any deal is unclear. The US financial services company had been suspected as a buyer for the four LatAm pension businesses BBVA put on sale last year. Earlier this month BBVA sold the AFP Horizonte in Colombia to Grupo Aval for $530m, and last year sold its Mexican operation to Banorte for $1.73bn. Both the Chilean and Peruvian assets remain on the block. Goldman Sachs has been advising BBVA on the sale process.