Category: Mexico

Mexican builder Empresas ICA, in a joint venture with Fluor, has won a $100m contract to build a nitrogen injection plant and 26MW power plant for Sempra Energy. The two facilities will support Sempra’s Energias Costa Azul LNG import terminal being constructed near Ensenada, Mexico. The ICA projects are expected online 2010, while Sempra’s 1bn cubic-feet-a-day LNG terminal is scheduled to begin operations later this year.

BBVA Bancomer has launched what it says is the first investment fund in Mexico to focus on BRICs. The fund is available for Mexican private banking costumers of BBVA and has no minimum entry amount. It will purchase ETFs in BRICs at the international quote system (SIC) of the Mexican stock exchange, to tap their high yield potential. “We are recommending our clients to keep the investment in the fund for at least year in order to get the best returns,” says Jorge Perez Samano, director of asset management at the shop. The bank expects to raise MXP500m for the fund and collected more than MXP100m on its first day, according to Perez Samano.

Mexico’s Grupo Financiero Interacciones expects to finance more than MXP9bn in infrastructure projects in 2008, nearly double the amount it financed last year. The projects include public works at the federal, state and municipal levels, and owe much of their greater interest to the government’s infrastructure plan. Interacciones financed MXP4.21bn in infrastructure projects last year, including the Mexico-Toluca and Mexico-Guadalajara highway concessions, the El Cajon hydro power project, and several water treatment plants.

Mexican sporting goods retailer Grupo Marti plans to issue 100m new shares in a follow-on worth a total of MXP1bn. The offering on March 12 follows a four-for-one share split that will take effect March 10. In the transaction, shareholders will be allowed to purchase 0.16 new shares for each share they already own.

In a tough local market, blue chip Mexican issuer America Movil has priced MXP2.5bn in 2018 bonds at 8.11%. The maximum amount was reached at an auction yesterday and the coupon compares to the America Movil 8.46% of 2036 and 9% of 2016. Proceeds from the AAA locally-rated deal will go towards general corporate purposes. The offer is the fourth under a MXP10bn shelf filed last year. Inbursa, Banamex and Santander managed the sale.

Mexico’s central bank sold MXP7.4bn ($692m) worth of peso denominated 7.75% 2017 notes Tuesday in exchange for MXP6.69bn worth of old 8.00% 2015 notes at 103.37 and MXP910m worth of 7.25% 2016 notes at 98.83. The offering is part of an ongoing effort by Hacienda to boost the liquidity of benchmarks, Alicia Nunez, deputy general director of debt issuance, tells LatinFinance. Banxico offered to swap MXP10bn, which means it succeeded in selling 74% of the total. This was significantly higher than the 17% Hacienda achieved in a February 20 offer to exchange UDI bonds. Nunez says UDIs are less liquid than peso notes, which explains the lower participation in the previous exchange.

Mexican coke bottler Embotelladora Arca has agreed to purchase Grupo Guerrero, owner of Coca Cola bottling rights in northwestern Argentina. The amount of the transaction was not disclosed but was above $10m, according to Carlos Beltran del Rio, manager of investor relations at Arca. “We are looking at expansion opportunities outside Mexico,” he says, adding that there are few Coca Cola bottlers for sale. The deal should close in the next 6-9 months, after which Arca expects to offer new products to the Argentine market. The franchise includes the provinces of Catamarca, Jujuy, La Rioja, Salta, Santiago del Estero and Tucuman. It sold approximately 80m cases in 2007.

Hallgarten has issued a strong buy recommendation on Canadian miner Fortuna Silver Miner, which operates the Caylloma field in Peru and San Jose in Mexico. “On face value alone, the company is an interesting option as a vehicle to ride the secular bull run in both base and precious metals, as it has strong expansion plans [and] has cash to fund the operations with little or no need to go to the currently tight credit market for funds,” the shop says. It adds that the company is investor-friendly for its share structure and policies. Hallgarten also highlights the potential of its Peruvian operation.

Fitch Ratings has lowered its debt ratings on bonds from Mexico’s GMAC Hipotecaria to BBB+ from A+, it said. The downgrade, affecting MXP2.15bn in three issues, follows the recent downgrade of parent Rescap to BB minus from BB+.

Scotiabank Inverlat has registered to sell MXP2.5bn in 2028 RBMS. The AAA locally rated fixed-rate notes are expected to price March 13 at the earliest. The issue is the first from a MXP10bn shelf. The pool of 2,750 mortgages originated by Scotia comes from throughout Mexico, with just over one-third from DF. Scotia’s own capital markets group is managing the sale.