Hyatt Hotels has agreed to acquire the Hotel Nikko Mexico in Mexico City for $190m from Japan-Mexico Hotel Investment. The deal for the 38-story luxury hotel is scheduled to close in May, and the property will be rebranded as the Hyatt Regency Mexico City. Hyatt plans to invest about $40m in a 3-year renovation for the Polanco hotel, to be Hyatt’s fourth in Mexico.
Category: Japan
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Brazilian FPSO Set for Financing
The Cernambi Sul MV24 production, storage and offload (FPSO) project is expected to close a 19-year $1.1bn term loan this week. The financing is divided into a $450m tranche with Mitsubishi UFJ and Sumitomo Mitsui as MLAs and Mizuho and Sumitomo trust as arrangers. The Japan Bank for International Cooperation (JBIC) was MLA and guarantor on a second $675m tranche, which also counted Mistubishi UFJ as an arranger. Both parts have identical maturities, and pricing is expected at Libor plus a spread in the mid to upper 200bp range, according to a person familiar with the deal, who declines to elaborate further. Cernambi Sul MV24 is an FPSO built by Japan’s Mobec and co-sponsored by Mitsui & Co and Marubeni, for use in Brazil’s Cernambi Sul pre-salt fields.
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Peru on Track for Infrastructure Project Funds
The government of Peru is on track to receive $95m in loans from Japan International Cooperation Agency (JICA). A JPY4.4bn ($54.9m) 25-year loan with a 1.7% fixed interest rate will fund an irrigation project and a JPY3.2bn ($40m) 25-year loan, also with a 1.7% fixed interest rate, will fund water and sanitation projects. A commitment note has been signed by the countries’ governments, with the loan agreement still pending, according to a person familiar with the financing. The two aforementioned projects are focused mainly on poverty reduction in Peru’s Sierra region. JICA has 38 prior projects with Peru.
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BNDES Approves Hyundai Brasil Loan
BNDES has approved a 6.5-year, BRL307.4m ($179.3m) loan for Hyundai Motor Brasil. The interest rate is the TJLP plus a spread which BNDES declines to disclose. Proceeds will support manufacturing at the Piracicaba plant, the South Korean firm’s first factory in Brazil.
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Mitsubishi Buys Brazilian Grain Stake
Mitsubishi has agreed to purchase a 20% stake in Grupo Los Grobo’s Ceagro do Brasil unit, one of Latin America’s top grain producers, for about JPY3.5bn ($45.61m).
Recently appointed Ceagro CFO Antonio Oliva Neto tells LatinFinance that the deal brings important synergies to the business. Ceagro focuses on financing producers, production, storage and supplying the local market, while Mitshubishi is active across the value chain from ports right down to the final consumer through supermarkets and fast food chains. “Ceagro will benefit from new business opportunities and be able to reach new markets,” he says. Mitsubishi is expected to purchase the stake through a capital increase. Ceagro currently operates in Brazil, Argentina, Uruguay and Paraguay and seeks to leverage the Mitsubishi deal to become a centralized grain originator in the countryside and also to export grain to new destinations. Ceagro officials declined to offer any additional details of the transactions. Officials at Mitsubishi could not immediately be reached for comment. Mitsubishi has been an active participant in the agricultural business in Latin America. Last year, the Japanese company had a hand in exporting more than 10m tons of grain from the USA, Brazil, Argentina and Australia to its customers in several Asian countries.
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Court Orders Anglo to Show Mitsubishi Contract
A Chilean court has ordered Anglo American to unveil the details of its sale of a 24.5% stake in the Anglo American Sur project to Mitsubishi, a deal at the heart of an ongoing legal dispute with Chilean miner Codelco. The Segundo Juzgado Civil in Santiago has asked Anglo to show it the sale contract and the shareholders agreement signed with the Japanese company. The step will allow the court and Codelco officials to study a possible suit to nullify the transaction, says Codelco. Officials at Anglo could not immediately be reached for comment, but the company has argued that it had the legal right to sell the stake. In November, Codelco sought legal recourse against Mitsubishi, but lawyers for the Japanese company told the courts that the unit charged with signing the deal with Anglo has no Chilean representation. Anglo’s decision to sell a stake in the mine venture came after Codelco had voiced its intention to exercise an option to buy a 49% stake in the Anglo American Sur project at a previously established price of roughly $6bn or 10.2x 2010 Ebitda. In early November, Anglo sold a 24.5% stake to Mitsubishi for $5.39bn or a multiple of 18.1x 2010 Ebitda. Anglo has argued it had the right to sell the stake and that it is now entitled to subtract that stake from the 49% that Codelco originally sought to buy. Codelco insists in having its 49% ownership and has so far pursued the matter through the Chilean courts.
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UMS Moves Closer to Samurai Sale
United Mexican States (UMS) may issue its Samurai as soon as December as it looks to consolidate its presence in the Japanese market with a transaction that is not guaranteed by JBIC. “Our next step is to issue without a JBIC guarantee and allow [the transaction] to take place in the last month of this year or early January,” Alejandro Diaz, the country’s head of public credit, tells LatinFinance. The sovereign has typically tapped the Samurai market using guarantees from JBIC, but has long hoped to sell plain vanilla bonds in this country. Mexico is flexible on size and tenor depending on risk appetite among Japanese investors, but ideally it is looking at a JPY-40-50bn ($519m-$649m) 5 or 10-year “We understand the first issuance may be in the lower part of the curve and we don’t have a problem with that,” Diaz says The sovereign would follow in the wake of America Movil (AMX), which in October became the first LatAm corporate to issue a Samurai without a JBIC guarantee. At the time, AMX tested the waters with a JPY12bn ($156m) a dual-tranche issue, selling a JPY6.9bn 3-year at par to yield 1.23% or yen Libor+80bp, and a JPY 5.1bn 5-year at par to yield 1.53% or yen Libor+100bp. UMS last issued in the Samurai market in 2010, when it placed a JPY150bn ($1.8bn) 10-year to yield 1.51%. Citigroup, Bank of Tokyo Mitsubishi, and Nomura took the sovereign to meet Japanese investors on a non-deal roadshow in August and will most likely assist with the next Samurai transaction, Diaz says.
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Chilean Court Backs Codelco, Freezes Anglo Stake
A Chilean court on Tuesday issued an order to prevent global miner Anglo American from selling its remaining 75.5% stake in the Anglo Sur copper mining complex, following a controversial sale to Japan’s Mitsubishi. Anglo struck a $5.39bn deal last week to sell a 24.5% stake to Mitsubishi in an attempt to sidestep an option to sell a full 49% share to state-owned Codelco at a cheaper price in January 2012. The sale to Mitsubishi represents a multiple of 18.1x 2010 Ebitda, far higher than the 10.2x 2010 Ebitda multiple Anglo would realize if it sold a 49% stake to Codeco for $6bn, as stipulated in the option. Codelco filed an injunction following last week’s deal with Mitsubishi, “to stop Anglo’s threat of selling additional shares”, says a Codelco spokesman. Officials at Anglo American could not be immediately reached for comment. Codelco doesn’t question the sale to Mitsubishi, the spokesman adds, but it still expects Anglo to sell it a 49% stake as stipulated. According to the option, Codelco can buy a 49% stake as long as Anglo still holds a 100% in the venture, otherwise it must buy less. Codelco argues, however, that Anglo had already received notice of its intentions to buy the 49% stake and as such it must still sell that piece of the business next year.
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Mitsubishi Upends Codelco’s Anglo Sur Ambitions
Anglo American has agreed to sell 24.5% of the Anglo Sur copper mining complex in Chile to Mitsubishi in a surprise $5.39bn deal. The move lands a blow to Chilean state copper company Codelco’s ambitions to secure a 49% stake in the venture. Mitsubishi swooped in on the chance to pay $5.39bn for only 24.5%, or a multiple of 18.1x 2010 Ebitda. Mitsubishi’s implied enterprise valuation for the entire project was $22.9bn. Codelco can now only buy a smaller, 24.5% piece. “The valuation is compelling,” an Anglo American spokesman says when asked to comment on the sale, which comes just ahead of the government’s option exercise date. Goldman Sachs and UBS advised Anglo American on the deal, according to company officials. Codelco sought to exercise an option in January 2012 to buy 49% of Anglo Sur paying an estimated $6bn, or 10.2x 2010 Ebitda. The option made this possible as long as Anglo American held 100% of the venture at the time, Anglo American officials said. Codelco officials could not be reached for comment, but in a statement the company said the transaction “doesn’t affect Codelco’s rights over 49% of the shares in Anglo Sur” and that it would “pursue all necessary actions” to defend its rights. Mitsubishi has been a long-time investor in Chilean copper and currently holds a 2.5% stake in Chile’s Escondida open pit mine.
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Mitsubishi Nabs Chilean Salmon Play
Japan’s Mitsubishi has agreed to pay $125m for Chile’s Salmones Humboldt, as it expands its salmon fishing business in South America. The deal is valued at roughly JPY10bn ($125m), Mitsubishi says, and was executed through its subsidiary Southern Cross Seafoods (SCS). Mitsubishi officials could not be reached for comment, and Salmones Humboldt did not return calls seeking additional information. Salmones Humboldt is based in the southern city of Puerto Montt where Mitsubishi’s SCS unit is also located. The acquired company has a processing and farming capacity of 20,000 metric tons a year, according to Mitsubishi estimates. SCS currently holds a 10,000 metric ton-a-year capacity. The move is the latest in the consolidation of fishing sectors in Chile and Peru in recent years.