Category: Mexico

Gas Natural has won the auction to acquire a portfolio of EDF electric generation assets in Mexico, it said in a statement. The package includes five combined-cycle gas-fired plants totaling 2,233 megawatts, their operating company Comego and the 53km Gasoducto del Rio pipeline. The Barcelona-based utility plans to fully finance the $1.45bn acquisition through debt. The deal is expected to be completed by the end of the year following approval from Mexican and French authorities. The transaction will be earnings accretive from the first year, Gas Natural said. Gas Natural is now Mexico’s second-largest private power generator. JPMorgan ran the sale for EDF, while UBS advised Gas Natural.

Goldman Sachs predicts no change in rates today from the central banks of Colombia and Mexico. The shop forecasts a 9.25% rate in Colombia, which will look to further reassess the domestic and external backdrop. “The bank will probably also take some comfort from the fact that leading indicators of activity are showing some moderation at the margin,” says Goldman. Meanwhile, it expects Banxico to hold the TdF and corto at 7.25% and MXP79m, respectively. “Banxico will keep the tightening bias, observing that it stands ready to tighten if the prolonged wage of relative price shocks leads to disorderly price gouging and higher wages,” says Goldman, adding that the TdF will not likely change for the rest of 2007. Elsewhere, the shop notes a hawkish tone to Brazil copom minutes.

Goldman Sachs predicts no change in rates today from the central banks of Colombia and Mexico. The shop forecasts a 9.25% rate in Colombia, which will look to further reassess the domestic and external backdrop. “The bank will probably also take some comfort from the fact that leading indicators of activity are showing some moderation at the margin,” says Goldman. Meanwhile, it expects Banxico to hold the TdF and corto at 7.25% and MXP79m, respectively. “Banxico will keep the tightening bias, observing that it stands ready to tighten if the prolonged wage of relative price shocks leads to disorderly price gouging and higher wages,” says Goldman, adding that the TdF will not likely change for the rest of 2007. Elsewhere, the shop notes a hawkish tone to Brazil copom minutes.

Advent International has acquired 100% of Grupo Gayosso, the Mexican funeral services company, from private investors in a $317m leveraged buyout. The transaction was funded with equity provided by Advent and $195m in acquisition financing led by Scotiabank and Ontario Teachers’ Pension Plan. Besides a senior term loan and working capital facility, the financing includes a $40m subordinated loan with an 8-year bullet payment. Gayosso offers a complete range of funeral products and services through a nationwide network. “We see significant opportunities to grow by acquiring incumbent players in key cities not served by Gayosso and by opening new facilities in select locations,” says Alfredo Alfaro, a partner in Advent’s Mexico City office. Advent predicts consistent long-term growth in the Mexican funeral services market. In conjunction with the buyout, Advent has appointed a new CEO of Gayosso, Rafael Obregón, and named one of its operating partners, Kenneth Budde, to the company’s board. Obregón was previously CEO of Casa Herradura, the tequila producer. Gayosso is the latest acquisition by Advent’s $1.3bn Latin American Private Equity Fund IV.

Mexican auto parts maker Sanluis Rassini is out with guidance of 11.5% area on a $275m 2017 senior unsecured bond issue. Proceeds will be used to refinance some $240m in debt. The issue via Morgan Stanley is rated B2 by Moody’s and B minus by Fitch.

Mexican mortgage company Hipotecaria Su Casita says bondholders representing 74.5% of $150m bonds due 2016 have tendered bonds in a cash offer that expires November 6. Bondholders representing $111.7m of Su Casita’s 8.50% senior notes due 2016 had tendered their offers and given consent for changes in the terms by Tuesday’s cutoff. Those participants will get a payment equal to 105.5% of face value, including a 3% of face value consent payment. Proceeds from a certificados bursatiles issue due 2012 will cover the buyback. Merrill Lynch is dealer manager.

Rating agencies have affirmed their view of Merrill Lynch Mexico, despite monster losses at the parent. Fitch cut Merrill Lynch and its subsidiaries and kept it on negative outlook following revised earnings for third quarter 2007. “The size of trading losses and unrealized losses unexpectedly overwhelmed the performance of the consolidated firm,” says the agency. “The size of Merrill Lynch’s CDO position and subsequent loss reveal deficiencies in risk management. Fitch anticipates liquidity and pricing challenges to prevail in the market over the intermediate term potentially resulting in lower revenues (in select products/services), investment write-downs and/or fewer principal trading opportunities,” it adds. It affirmed a Triple A long-term senior rating, with a stable outlook, on Merrill Lynch Mexico, Casa de Bolsa. S&P also affirmed a Triple A and says the loss will not impact.

Rating agencies have affirmed their view of Merrill Lynch Mexico, despite monster losses at the parent. Fitch cut Merrill Lynch and its subsidiaries and kept it on negative outlook following revised earnings for third quarter 2007. “The size of trading losses and unrealized losses unexpectedly overwhelmed the performance of the consolidated firm,” says the agency. “The size of Merrill Lynch’s CDO position and subsequent loss reveal deficiencies in risk management. Fitch anticipates liquidity and pricing challenges to prevail in the market over the intermediate term potentially resulting in lower revenues (in select products/services), investment write-downs and/or fewer principal trading opportunities,” it adds. It affirmed a Triple A long-term senior rating, with a stable outlook, on Merrill Lynch Mexico, Casa de Bolsa. S&P also affirmed a Triple A and says the loss will not impact.

Mexican auto parts maker Sanluis Rassini is out with guidance of 11.5% area on a $275m 2017 senior unsecured bond issue. Proceeds will be used to refinance some $240m in debt. The issue via Morgan Stanley is rated B2 by Moody’s and B minus by Fitch.

Mexican mortgage company Hipotecaria Su Casita says bondholders representing 74.5% of $150m bonds due 2016 have tendered bonds in a cash offer that expires November 6. Bondholders representing $111.7m of Su Casita’s 8.50% senior notes due 2016 had tendered their offers and given consent for changes in the terms by Tuesday’s cutoff. Those participants will get a payment equal to 105.5% of face value, including a 3% of face value consent payment. Proceeds from a certificados bursatiles issue due 2012 will cover the buyback. Merrill Lynch is dealer manager.