Enersis and Endesa Chile saw their senior unsecured debt upgraded to Baa2 from Baa3 with a stable outlook by Moody’s. The ratings agency says the upgrade reflects each company’s strong credit metrics and an expectation that cash flow generation will remain strong. Moody’s says both companies will continue to demonstrate financial performance consistent with the Baa rating category despite an expectation for some degradation in the near term due to lower margins in some markets.
Category: Chile
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Chile’s CAP Extends Loan
Chile’s CAP has extended a 3-year loan into a 5-year facility, upsizing to $200m from an original $150m, according to a banker with knowledge of the transaction. The steel and iron ore producer priced the transaction at Libor+ 125bp on a leveraged grid, says a banker with knowledge of the transaction. Bank of Tokyo Mitsubishi and HSBC are joint bookrunners on the deal. EDC Canada and Santander came in as new lenders. Banco del Estado de Chile, Scotia, BBVA, Mizuho and Societe Generale also participated, and had been in the original deal.
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Acciona Chile Sale Was Expected
Spanish infrastructure company Acciona has sold its stakes in 3 Chilean toll roads to Italy-based infrastructure investment firm Atlantia for $639m equivalent, including debt. As part of the deal announced yesterday, Acciona is selling 50% of Sociedad Concesionaria Autopista Vespucio Sur, 50% of Sociedad Concesionaria Litoral Central and 50% of Sociedad de Operacion y Logistica Infraestructura. “The deal was expected,” says a Madrid-based equities analyst, adding that Acciona has decided to focus on renewable energy assets. Another Madrid-based analyst says that in 2009, Acciona had purchased wind and hydro power assets in Spain and Portugal from Spain-based power company Endesa for about EUR2.8bn. Atlantia says it had purchased the remaining 50% stakes in 2008. In that deal, which also included assets in Brazil and Portugal, Atlantia paid EUR420m. UBS acted as Atlantia’s financial advisor and BBVA advised Acciona.
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Factorline Completes Local Issue
Chilean financial services company Factorline has issued UF1.6m ($74.0m) in A rated 10-year bonds, getting more than 2x demand, says a banker on the deal. The UF notes priced a 3.80% coupon at 99.43 to yield 3.90%, or 115bp over the BCU-10 benchmark. The tranche follows a CLP15bn ($32m) portion which priced Tuesday. Proceeds will be used to finance the opening of a leasing unit, says the banker, who adds that the business will generate revenues in UF. Tuesday’s 5-year CLP bonds priced a 7.0% coupon at 98.41 to yield 7.51%, or 116bp over the BCP-5 benchmark. Proceeds from the CLP tranche are marked for refinancing debt and for working capital. Banco de Chile managed the sale.
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Aguas Andinas Issues UF Bonds
Chilean water utility Aguas Andinas has issued UF2.75m ($126m), getting demand for 3x the amount offered, according to LarrainVial, which lead the sale with BBVA. The AA+ rated notes were issued in 2 tranches. A 5-year UF1.25m piece priced a 3.17% coupon at 99.94 to yield 3.18%, a 71bp spread over the BCU benchmark. A 22.5-year UF1.50m piece priced a 3.86% coupon at 101.59 to yield 3.75% or 65bp over the BCU benchmark. A banker on the deal says that while the company had intended to raise up to UF4.4m, it decided it only needed UF2.75m to finance its capex plan. Aguas Andinas is controlled by Agbar, a unit of France’s GDF Suez.
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Vapores Approves Equity Raise
The board of Compania Sudamericana de Vapores has approved a $500m increase in its equity capital, it says, through the issue of new shares. The Chilean shipping company has not communicated the details of the transaction. Vapores shares closed at CLP367.34 Monday.
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Cencosud Plans Follow-on
Chilean retailer Cencosud plans to sell as much as $2bn in new shares to help finance growth, according to an announcement for a shareholder meeting proposing the plan. The company has scheduled an April 29 meeting, but does not give any more details. Cencosud officials could not be reached for further comment. Cencosud closed Tuesday at CLP3,333, down 4.82%.
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Chile Tightens Rate
As expected by market consensus, Chile’s central bank increased its rate by 50bp to 4.50%. It cites the increase in oil and food prices globally and a positive trend in local demand and employment as reasons for the hike. Nomura believes the bank will hike another 50bp in May and 25bp in June. Bulltick expects the bank to increase the rate to 5.50% by the end of the year to combat the rise in inflation.
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Factorline Sees Demand for Bonds
Chilean financial services company Factorline has issued CLP15bn ($32m) in 5-year bonds. The A rated notes priced a 7.0% coupon at 98.41 with to yield 7.51%, or 116bp wide of the BCP-5 government benchmark. The issuance saw demand of more than 2x book, according to a banker on the deal. The company is expected to issue a UF-denominated tranche on Thursday, the banker says, noting that bookbuilding is still taking place. Factorline is deciding between 2 possible UF tranches: a 7-year UF2.3m tranche with a 3.5% coupon and a 10-year UF2.3m tranche with a 3.8% coupon. Proceeds from the deal will be used to refinance debt and for working capital. Banco de Chile is managing the sale. In August, Factorline issued CLP20bn in 2015 local bonds through BBVA priced to yield 6.88%, or 129bp wide to the government benchmark.
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Forum Issues CLP Bonds
Chilean auto lender Forum issued CLP20bn ($41m) in local bonds. The 3-year AA minus/AA+ bond priced at 98.84 with a 6.90% coupon to yield 7.35%, or 102bp over the BCP-3 government benchmark. Demand was about CLP50bn, says a banker on the deal. Proceeds will go toward working capital. Banco Estado led the sale. In March, Forum sold a 6.75% coupon 2.5-year bond to yield 115bp over the BCP-3, also through Banchile.