Category: M&A

Canada’s Brookfield Renewable Power has completed a $120m financing to fund the acquisition of the Itiquira hydroelectric generating facility in Mato Grosso, Brazil, it said Monday. Brookfield – part of Brookfield Asset Management – bought the 156MW facility on the Itaquira river from NRG Energy for $288m in December. The facility’s output is contracted until 2014. Calyon and EDC led the financing.

Global law firm Jones Day has hired partner S. Wade Angus for its M&A practice. He was formerly a partner at Weil, Gotshal & Manges, where he led the firm’s Brazil practice. “Besides the rising tide of M&A and private equity activity in Brazil and throughout Latin America, many major transactions have international components in today’s environment,” says Angus.

Merrill Lynch has agreed to acquire Chilean equity brokerage firm Ureta y Bianchi Corredores de Bolsa. The purchase is part of a plan to build an investment banking platform in Chile, says the US shop. With the purchase, Merrill said it expects to service local, regional and international institutional investors and corporate clients. The brokerage will be renamed to incorporate the Merrill Lynch brand name. Francisco Ossa, a Ureta y Bianchi partner, will head Merrill Chile’s local equity business, joined by Manuel Jose Ureta, Alfredo Ureta and Ignacio Perez, also former partners. Hans Trautmann, Merrill Lynch’s senior fixed income banker based in Santiago, will oversee the development of FICC business in the country. Daniel Gonzalez will continue as the head of the Southern Cone countries, overseeing Chile, Argentina and Uruguay. Terms of the transaction were not disclosed.

Brazilian miner Vale denies that is considering an acquisition or discussing financing options with banks, in response to press reports. Local media say Vale technicians have visited Anglo American properties in Brazil and other locations worldwide, and that the company is assembling a war chest with several banks for a supposed acquisition. Last week, Vale announced in a filing with the CVM an issue of roughly $14bn in new preferred and ordinary shares that would generate proceeds for acquisitions. “Vale makes clear regarding news published by the Brazilian press that it is not negotiating the acquisition of any company and it is not discussing with banks the financing of an acquisition,” says the firm.

The successful spinoff of Telmex Internacional is expected to lead to acquisitions by the newly independent holding company. The $16bn Mexican spinoff is heard eyeing Telecom Argentina, Brazil’s Global Village Telecom and Chile’s Grupo GTD, according to bankers familiar with the company. The first two are said to be most actionable in the short term. “It’s going to be an acquisition machine, just like America Movil was when it was spun off from Telmex,” says a banker close to the corporate. Telmex Internacional is understood to be the largest spin-off ever done in LatAm. It was designed to allow the international and domestic units to each focus on their respective business and core geographic operations, thereby boosting competitiveness. Telmex Internacional, which has a net cash position, will focus on delivering high organic growth, and says it will pursue acquisition opportunities throughout LatAm wireline voice, video and data markets. The separation was advised by Lehman.

Mexican telecom Axtel is studying the acquisition of competitor Alestra, according to JPMorgan. “An acquisition could happen in the short to medium term, subject to price for the asset,” the shop says in a research report on Mexican corporates. The report finds that Mexican issuers are turning more to the local markets, in the face of difficulty raising funds abroad, and Mexico’s second-largest telecom is expected to refinance its $163m in 11% 2013 bonds in the local market. JPMorgan was also bullish on Maxcom’s bonds, which it found should be trading closer to those of Axtel and other peers. Other names likely to refinance debt include glassmaker Vitro, considering a takeout of its $225m in 11.75% 2013 bonds, possibly in the local market. Mobile operator Iusacell also intends to refinance $650m in different maturities, says JPM.

Several key LatAm Bear Stearns employees are not joining JPMorgan after the merger. Veteran banker AJ Mediratta, former senior managing director and head of international debt capital markets at Bear, left the firm yesterday. He is expected to resurface at a hedge fund with several former Bear colleagues. Meanwhile, ex-senior managing director Carl Ross – the shop’s well known head of research – is also heard moving on. Both have strong client relationships and were instrumental in building Bear’s Caribbean niche, which JPM hopes to maintain and bolt on to its existing LatAm franchise. Elsewhere, Robert Schmieder, an MD in charge of LatAm corporate fixed income analysis – a growing area that lacks detailed coverage on the sell-side – is also leaving the firm. “It’s tough – we had a great team at Bear,” says one former staffer at the doomed US shop, adding that employment market conditions made it impossible to keep everyone together. Meanwhile, Jose Luis Martinez has joined JPM as executive director in the LatAm investment banking group. The former MD in Bear’s investment banking team has expertise in Central America and Caribbean coverage. Head of trading and senior MD Adam Groothuis – a veteran in the underserved CentAm and Caribbean secondary markets – has also joined JPM. And ex-head of EM mortgage finance John Tonelli is also heard taking a new role at the merged entity.