Category: People

The Chilean government has decided not to sell a stake in state-owned copper miner Codelco, CEO designate Diego Hernandez tells LatinFinance on the sidelines of a Metal Bulletin copper conference in New York. During his election campaign, Chilean president Sebastian Pinera had proposed privatizing up to 20% of Codelco, which mining analyst Christopher Ecclestone of Hallgarten estimates could be worth $8bn-$10bn. Separately, Hernandez says Codelco’s 2010 investment budget is $2.3bn, up from $2.2bn in 2009, an amount he calls “a historical record.”

Mexican Airline Mexicana is preparing to sell dollar bonds as soon as June and eyes an eventual public listing, according to remarks from CEO Manuel Borja cited in local newspaper and wire reports. Mexicana seeks to raise $250m in international markets as part of an effort to improve its financial profile and improve transparency. “The bond sale, which improves our balance, is a first step, and within our objective to convert Mexicana into a public company at the beginning of next year,” Borja is report as saying. The bond would come with a $60m guarantee from Bancomext, and be used to refinance debt. Borja says Goldman Sachs has been hired to manage the bond transaction. Mexicana has not issued in the dollar markets since a 1999 $80m ABS transaction, according to Dealogic.

The exit of Bank of America Merrill Lynch (BAML) from its stake in Itau Unibanco will make “no difference” to the Brazilian bank’s strategy, according to its CEO. “We didn’t really have the opportunity to develop a great relationship, the time was too short in order to become really a strategic partner,” Itau CEO Roberto Setubal tells LatinFinance. BAML acquired the holding in May 2006 when Itau swapped $2.85bn in equity for BankBoston’s Brazil, Chile and Uruguay assets. Setubal says that some operations were discussed while BAML was a shareholder, but the period was dominated by the financial crisis. BAML hopes to get over $4bn from the sale, which will be used to repay TARP borrowing. “It was a good investment for them,” says Setubal. In the share sell scheduled for next Tuesday, BAML will sell all of its 188.4m Itau preferred shares through a 144a/RegS secondary ADS offering, representing 8.4% of the Brazilian bank’s preferred shares and 4.16% of total capital, Itau says. If done at Tuesday’s close of $18.19, it would raise $3.43bn. Itau’s holding company is itself set to privately buy 56.5m common shares, representing 1.2% of total capital, to boost its stake to 36.68%. The purchase price will correspond to the sale price of 1. “It’s a good opportunity for investors who want to be a shareholder of Itau to acquire a large portion of shares,” says Setubal. Bankers on the deal expect a wide distribution in the market, though current secondary volatility is viewed as unhelpful. Itau preferred shares slumped 5.1% to close at BRL33.20 Wednesday, underperforming the Bovespa, which dropped 1.9%. BAML and Itau will manage the secondary sale. To fund Itau’s purchase, the bank says its board has approved the sale of BRL1.4bn in new debentures by the holdco on the Brazilian market. After the sale, BAML will lose its seat on the Itau board. As part of BAML’s borrowing from the US government, it pledged to sell assets to produce a net gain of $3bn by June 30.

JBS has delayed plans for an IPO of its US unit until next year at the earliest, according to officials on an earnings call. “We have no plans for the IPO this year,” says CEO Joesley Mendonca Batista says. The company had had been pushing back the timing of the offering, expected at one point to be worth $2bn, since late last year. The meatpacker managed to raise BRL1.84bn through an April equity follow-on in Brazil.

BM&FBovespa plans to sell around $620m in 10-year dollar bonds to fund the purchase of a stake in the CME Group, according to remarks from CEO Edemir Pinto on an earnings call Wednesday. “We have zero debt and a lot of cash. To have an improved capital structure, the company has decided to look to fund 100% of the operation,” Pinto says, noting that this marks a change in its plans, from using cash to fund part of the operation. The sale should be resolved “soon,” he adds. In February, BM&FBovespa raised its ownership in the US exchange to 5.0% from 1.8%.

Minera Andes, a Canadian company with operations in Argentina, will probably go to market in the fall to raise $20m-$30m in equity by selling shares, president and CEO Rob McEwen tells LatinFinance. Minera Andes shares trade on the TSX and OTC in the US. The company has a market cap of CAD278m. Its San Jose mine produced 1m ounces of silver and 19,960 ounces of gold in Q4 last year, says the company. Its Los Azules project has an inferred mineral resource of 922m tons grading 0.55% copper and containing 11.2bn pounds of copper, it adds.

Dominican Republic-based residential and tourism real estate developer Group Metro is on a roadshow promoting its 5-year $75m Reg D private placement, president and CEO Luis Jose Asilis tells LatinFinance. He adds that the company has been to New York and Miami and that the tour should conclude in another 15-20 days. The borrower is targeting a yield of 12%-14%. US-based boutique investment bank Stephens is handling the issue. Group Metro’s developments, which employ about 1,500, are in the Juan Dolio area, about half an hour from Santo Domingo.

Codelco has named former BHP and Vale executive Diego Hernandez as its new CEO. Hernandez, who runs BHP’s base metals division, will take office May 19, the copper miner says. He replaces Jose Pablo Arellano, who has been nominated to the board of directors of LAN Airlines, according to local press.

Scotiabank’s Chile unit is planning to issue UF1.5m ($61.5m) in 2035 local bonds on Thursday, says Daniel Orellana, CEO of Scotia Sud Americano Corredores de Bolsa, which is managing the sale. Scotia says the bonds will have a 4.5% coupon and that proceeds will be used to refinance long-term debt. The notes are rated AA+ by Fitch and AA minus by Feller. Orellana adds that the bank plans to issue an additional UF1.5m, but that a date for that has not been set. In March, the bank issued UF4.0m in 2018 bonds, with demand surpassing UF6.0m. The bonds priced at 100.93 with a 3.20% coupon to yield 2.97%, a spread of 100bp over the 5-year central bank BCU5 bonds, Orellana says.

Banco de Chile says it has appointed Arturo Tagle Quiroz president and CEO, effective May 1. His predecessor, Fernando Canas Berkowitz, has resigned, effective April 30, the Chilean bank says in a statement.