Category: Mexico

Lamosa is planning to issue equity in the next year in a bid towards becoming one of Mexico’s most liquid stocks, say bankers familiar with the company’s plans. In Q1 2008, Lamosa is expected to issue shares for $250m-$300m as part of an agreement to bolster its equity capital base in the wake of sizable loan financing. Lamosa, which plans to continue growing through acquisitions, seeks to have better access to equity capital markets to support expansion through organic growth and acquisitions. It also wants to become part of the Mexbol’s IPC, which includes the country’s 35 most liquid stocks, to help reduce cost of financing.

Mexican home improvement products retailer Lamosa has wrapped up a financing package worth $900m, the proceeds of which were used acquire tile maker Porcelanite. A $675m, 4.7 average life dual currency syndicated loan was led by Scotia, and includes a $357m dollar tranche and a $243m peso tranche, both of which pay 200bp over either Libor or TIIE out of the box, at 3.0x-3.5x leverage. A $75m 3-year revolving credit line also includes both pesos and dollars. Other lenders include BBVA, Banamex, Comerica, HSBC, JPMorgan, Unicredit, Banorte, ING, Merrill Lynch, Inbursa, ABN Amro, Santander, and West LB. In addition, Ontario Teacher’s Pension Plan lent Lamosa $225m via a 7-year second lien loan that pays 400bp-450bp over Libor, according to bankers away from the deal. The loan is fully pre-payable by Lamosa in the first year provided the company issues new equity, which it plans to do in 2008. As a result, the subordinated piece is likely to be paid down within several months, highlighting a novel lending strategy from a large institutional investor in LatAm. Gibson, Dunn & Crutcher was legal counsel to Scotia and the other lenders in the acquisition financing.

S&P has affirmed the BB- long-term corporate credit rating on Mexico’s Corporacion Interamericana de Entretenimiento (CIE), as well as the B+ senior unsecured debt rating on its 2015 notes. It also removed the ratings from CreditWatch with positive implications, where they were put on August 17 after news of an MoU with Codere. The latter agreed to acquire a 49% interest in CIE Las Americas in exchange for Codere’s 50% interest in the existing gaming joint ventures within CIE Las Americas. The exchange with Codere resulted in a $175m cash payment from Codere to CIE. “The rating affirmation reflects our expectations that although CIE’s financial policy will continue to favor debt reduction, there is uncertainty regarding the timing and amounts of future debt reductions and particularly CIE’s discretion over the joint venture’s cash flows,” says S&P. “The affirmation also reflects our expectation that the new 20% tax on gaming that was recently approved by the Mexican Congress will have an impact on the company’s financial performance,” it adds.

Mexican building materials provider Cemex priced late Friday a MXP2.5bn UDI-linked local bond issue in two tranches. A MXP2bn 2010 tranche priced at 3.9% and a MXP456m 2017 tranche priced at 4.4%. Despite demand for more, the issue was capped due to an increase in rates during the sale period, according to bankers on the deal. Cemex plans to repay short and long term debt with proceeds. HSBC was the sole bookrunner. Separately, Femsa is due Wednesday with a MXP6bn offering. A MXP2.5bn 2017 UDI-denominated tranche is being prepared by HSBC and Santander, while a MXP3.5bn 2013 floater is coming via BBVA and Scotia.

Mexico’s Cemex has sold concrete operations in Florida and Arizona to Irish construction materials firm CRH for $250m. The divestitures had been required by US regulators as a condition for authorizing Cemex’s acquisition of Australia’s Rinker. Cemex plans to use the money to pay down debt, which reached $19.2bn in Q3 as a result of the Rinker deal. The two announced negotiations in September for up to $4.5bn in US and European assets, but have called off talks for a wider transaction, citing disagreement over price. Cemex has not said whether it still plans to sell those additional assets.

Enlace Int has hired Pershing, a subsidiary of The Bank of New York Mellon, to act as a principal clearing agent focused specifically on Mexican sovereign debt transactions. Enlace, a major inter-dealer broker in Mexico, will use Pershing’s PerNet Web-based middle office platform to monitor and reconcile accounts and trades. Pershing is a global provider of financial business solutions to more than 1,150 institutional and retail financial organizations and independent registered investment advisors.

S&P has affirmed the BB- long-term corporate credit rating on Mexico’s Corporacion Interamericana de Entretenimiento (CIE), as well as the B+ senior unsecured debt rating on its 2015 notes. It also removed the ratings from CreditWatch with positive implications, where they were put on August 17 after news of an MoU with Codere. The latter agreed to acquire a 49% interest in CIE Las Americas in exchange for Codere’s 50% interest in the existing gaming joint ventures within CIE Las Americas. The exchange with Codere resulted in a $175m cash payment from Codere to CIE. “The rating affirmation reflects our expectations that although CIE’s financial policy will continue to favor debt reduction, there is uncertainty regarding the timing and amounts of future debt reductions and particularly CIE’s discretion over the joint venture’s cash flows,” says S&P. “The affirmation also reflects our expectation that the new 20% tax on gaming that was recently approved by the Mexican Congress will have an impact on the company’s financial performance,” it adds.

Mexican building materials provider Cemex priced late Friday a MXP2.5bn UDI-linked local bond issue in two tranches. A MXP2bn 2010 tranche priced at 3.9% and a MXP456m 2017 tranche priced at 4.4%. Despite demand for more, the issue was capped due to an increase in rates during the sale period, according to bankers on the deal. Cemex plans to repay short and long term debt with proceeds. HSBC was the sole bookrunner. Separately, Femsa is due Wednesday with a MXP6bn offering. A MXP2.5bn 2017 UDI-denominated tranche is being prepared by HSBC and Santander, while a MXP3.5bn 2013 floater is coming via BBVA and Scotia.

Mexico’s Cemex has sold concrete operations in Florida and Arizona to Irish construction materials firm CRH for $250m. The divestitures had been required by US regulators as a condition for authorizing Cemex’s acquisition of Australia’s Rinker. Cemex plans to use the money to pay down debt, which reached $19.2bn in Q3 as a result of the Rinker deal. The two announced negotiations in September for up to $4.5bn in US and European assets, but have called off talks for a wider transaction, citing disagreement over price. Cemex has not said whether it still plans to sell those additional assets.

Enlace Int has hired Pershing, a subsidiary of The Bank of New York Mellon, to act as a principal clearing agent focused specifically on Mexican sovereign debt transactions. Enlace, a major inter-dealer broker in Mexico, will use Pershing’s PerNet Web-based middle office platform to monitor and reconcile accounts and trades. Pershing is a global provider of financial business solutions to more than 1,150 institutional and retail financial organizations and independent registered investment advisors.