Category: M&A

Colombia’s Compañía Nacional de Chocolates, the country’s largest food retailer, has agreed to buy Peruvian company Good Foods for $36 million. The acquisition will be carried out via Chocolates’ Peruvian unit and the company hopes to close the sale by February of next year. Chocolates aims to make its presence felt in the Peruvian market with the acquisition, which is the fifth in the region this year. The company plans to finance the acquisition via a bank loan.

Colombian retailer Almacenes Exito has secured a loan worth $300 million to finance its acquisition of rival retailer Carulla Vivero. The syndicated loan was arranged via a group of foreign banks led by JPMorgan Chase. Earlier this year, Exito agreed to buy a 77.5% stake in Carulla Vivero for $433 million.

Mexican operator Telmex has agreed to buy another two Colombian cable TV companies: TV Cable and Cable Pacífico. The acquisitions will add a further 195,000 subscribers in Bogota, Cali and Medellin. In September the Mexican operator paid over $30 million for Colombian cable operator Superview, which brought with it 125,000 subscribers.

Axtel, the Mexican telecom, is out with a $518 million financing for its acquisition of Avantel through Citigroup and Credit Suisse. A $208 million five-year term loan to refinance Avantel debt and a $310 million 18-month bridge are out to MLAs and the transaction should close early in 2007. The acquisition is slated to close this year. Citigroup is the indirect controlling shareholder in Avantel and is taking up to a 10% equity stake in Axtel.

Colombia’s Davivienda is out with a $250 million three-year acquisition facility through Credit Suisse, JPMorgan and Wachovia. The margin is 87.5bp in year one, 100bp in year two and 112.5bp in year three. Davivienda is buying Granbanco for around $900 million. Amortizations start in month 24.

Brazilian steelmaker Gerdau, via its Spanish subsidiary Sidenor, is to buy Spain’s GSB for $143 million from CIE Automotive. The acquisition is expected to close by year end. The move to buy GSB comes hot on the heels of an equity increase last week by Gerdau in Peru’s Empresa Siderúrgica del Perú (Siderperú). The Brazilian firm spent $40.5 million to buy a further 32.85% share and take control of 83.27% of Peru’s largest steelmaker. Earlier this year, Gerdau handed over $103 million for Sheffield Steel Corp of the US.

Brazilian steel producer CSN has jumped on the Latin M&A bandwagon with an $8 billion cash offer for British steel group Corus, trumping a bid made last month by India’s Tata Steel. The cash offer of 475 pence per ordinary share will be covered by existing resources and new debt facilities underwritten by Barclays, Goldman Sachs Credit Partners and BNP Paribas, CSN said. Otavio de Garcia Lazcano, CSN’s chief financial officer, said a large part of the financing would have no recourse to CSN. Lazard is lead financial adviser to CSN, while Goldman Sachs is financial adviser and joint broker, and UBS is joint broker. The combined CSN-Corus would create a top five global steel producer, according to the Brazilian acquirer. CSN indirectly owns 34 million Corus ordinary shares or 3.8% of the issued ordinary share capital of Corus. The CSN announcement follows a $12 billion Cemex bid for Rinker and CVRD’s $18 billion acquisition of Inco. M&A bankers say there is more to come in the short term from Latin America and predict a bumper 2007.

Mexico’s largest locally owned bank, Banorte, said it will buy the remaining 30% in Inter National, after it closed its acquisition of the US bank, Thursday, following the approval by both Mexican and US banking regulators. Banorte said it would pay somewhere between $111 million and $191 million for the equity interest. Banorte became the first Mexican financial entity in recent decades to buy a US bank, when it agreed to pay $259 million for a 70% stake in the Texas bank at the end of January this year. Banorte has an option to buy the remaining 30% stake over the next five years. Inter National will become part of a new division of Banorte, entitled Banorte USA.

Mexico’s competition commission rejected, for the second time, the merger of two railroads owned by Grupo Mexico, the country’s largest copper producer. Kansas City Southern Industries, which owns the third of the country’s main railroad networks, had complained the merger would hurt competition as it would have given a 54% market share to the merged operators. Grupo Mexico bought Ferrosur, which operates mainly in the south, from magnate Carlos Slim, to merge it with its Ferromex operations in northern Mexico. The Commission first rejected the merger in June.

Mexican telco Telmex completed its tender offer to buy up the remaining shares in Brazilian operator Embratel and succeeded in acquiring 96.4% of all the company’s capital stock. The acquisition is sufficient for Telmex to close the capital of the Brazilian long-distance operator, following approval from the regulator Anatel. For the next three months, through February 2007, any remaining shareholders can sell their shares to Telmex at the voluntary tender offer price, adjusted by the monthly Brazilian benchmark rate (TR).