Category: Mexico

Moody’s has lowered the ratings of the senior certificates MXMACFW 07U issued under the MXMAC program established by GMAC Financiera in Mexico to Baa3 from A3 on the global scale. The agency also cut the senior certificates MXMACFW 06U of the same program to Baa3 from A3 in the global scale and placed it on review for further downgrade. “This rating action is based on the continued weaker than expected performance of the collateral assigned to the transaction,” says Moody’s.

Mexico is set to launch the sale of debt exchange warrants with a total notional value of $1.25bn allowing investors to exchange foreign currency debt for peso debt. Today and tomorrow, investors can buy two classes of warrant allowing the exchange of 21 series of dollar, euro, deutschemark and Italian lira-denominated bonds with maturities between 2009 and 2034 for local bonds. The first warrant has a notional value of about $1bn and offers peso-denominated bonds due 2014, 2017 and 2036. The second is worth roughly $250m and offers 2017 and 2035 debt denominated in UDIs. Holders of the warrants will be able to receive their new bonds on October 9. Barclays and Merrill Lynch are managing the transaction.

Mexico’s Grupo Posadas expects to price up to MXP3bn in 2018 fixed and 2013 floating-rate notes April 8, according to bankers managing the sale. The hotel operator had originally set a date of April 1 for the offer, according to regulatory filings. But a banker on the deal says that was only a provisional date. Posadas plans to use proceeds from the mxA/mxA- offering to fund a buyback of dollar-denominated debt. As of March 31, it had received tender commitments from a majority of holders of its $225m outstanding 8.75% 2011 bonds, in an offer expiring April 11. Credit Suisse is dealer manager on the tender and also managing the debt sale.

Cemex has sold most of its stake in Mexican telecom Axtel, netting $257m. The 119m shares represent 9.5% of Axtel’s total equity capital and 90% of the stake the cement producer held in Axtel as part of a long-term investment strategy. CFO Rodrigo Trevino says proceeds will be used to repay debt, and that the forward contracts used in the transaction will allow Cemex to benefit from future appreciation in the shares. Separately, Cemex is preparing to sell MXP3bn in peso-denominated bonds this month.

Mexico’s Grupo Posadas is expected to sell up to MXP3bn in 2018 fixed and 2013 floating-rate notes today. Proceeds from the mxA/mxA+ transaction will help fund a repurchase of up to $225m in 8.75% 2011 bonds. Separately, the hotel operator has received the consent of a majority of the issue’s holders at the time of its early consent date. The offer launched March 17 pays $1,035 per $1,000, and expires April 11. Holders tendering before March 28 received $1,050 per $1,000. Credit Suisse is dealer manager on the tender and also managing the debt sale.

Mexican building materials provider Cemex plans to sell up to MXP3bn in peso-denominated bonds in April. The mxAA+ offering will include a 2018 fixed-rate tranche, and a 2010 tranche over 28-day TIIE. Cemex has not yet set the sale date or indentified use of proceeds. Santander is managing the sale. Cemex sold MXP2.5bn in 7 and 10-year UDI-denominated bonds in December via HSBC. Separately, ING Hipotecaria is heard preparing a RMBS issue of up to MXP1bn via Santander to price in April. Grupo Posadas’ MXP2.5bn sale in 2018 fixed and 2013 floating-rate notes via Credit Suisse is slated for April 1, and Infonavit is preparing to sell MXP3bn in 2030 MBS April 9 through Banamex and Deutsche. Telmex may also follow with a mixed issue of up to MXP3bn in AAA notes up to 20 years via Inbursa. Broadcaster Televisa has filed for an MXP7bn 4-year shelf.

Mexico’s industrial conglomerate Grupo Kuo has agreed to sell its Quimir phosphate business to chemical firm Mexichem for an undisclosed amount. Kuo plans to use proceeds of the sale to fund projects and pay down debt. Quimir had sales of about $160m last year and specializes in the production of industrial phosphates, used mainly in detergents. Mexichem plans to spend $300m on acquisitions in the near term in Mexico and LatAm.

Mexico plans to sell warrants with a notional value of $1.25bn that will allow investors to exchange foreign currency debt for peso debt. On April 2 and 3, investors will be able to purchase two types of warrant that allows them to trade in 21 series of dollar, euro, deutschemark and Italian lira-denominated bonds with maturities between 2009 and 2034 for local bonds. The first warrant has a notional value of about $1bn and offers peso-denominated bonds due 2014, 2017 and 2036. The second is worth roughly $250m and offers 2017 and 2035 debt denominated in UDIs. Holders of the warrants will be able to receive their new bonds on October 9. This is the first Mexican warrant transaction to allow swapping into UDIs, as well as the first time the liquid global 2034s will be involved, according to a banker on the deal. This is the fourth sale of warrants since 2005. The government has exchanged more than $4bn in foreign-currency debt for peso bonds in the last two years. Barclays and Merrill Lynch are managing the transaction.

S&P has cut the national-scale rating of Mexico’s Coppel to mxA minus, from mxAA minus. The donwngrade was triggered by the retailer’s aggressive expansion plans. They include opening new stores, Coppel’s acquisition of Hipotecaria Credito y Casa and the opening of the Banco Afore Coppel, which has seen leverage increase. The issuer had been on credit watch since November, and its outlook is stable.