Itau BBA has hired Alberto Mulas as CEO for Mexico, it says, starting in January when it officially initiates operations there. The Brazilian bank is in the process of opening a broker-dealer in Mexico, and has been working with Cresce Consultores, the advisory firm Mulas has operated since founding it in 2003. Prior to that, Mulas was the Mexican government’s national housing commissioner, after working at banks including JPMorgan and Lehman Brothers. Itau’s plans are in line with other large LatAm institutions looking to become full-service investment bank operations outside their home country. Itau worked on Banorte’s $2.5bn equity follow-on in Mexico this year.
Category: Regions
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Mexican to Test HY Market
Mexico’s Grupo Idesa is preparing to meet investors ahead of a $300m bond sale, what would be the petrochemical producer’s first cross-border deal. The target would be a 2023 note, according to Fitch, which assigns a BB minus rating. Idesa plans to start Wednesday a roadshow visiting London, New York, Los Angeles and Boston through December 9, according to people following the process. Morgan Stanley, HSBC and Scotiabank are managing. The issuer is seeking funds to refinance $195m of existing debt and for general corporate purposes, including capex and other investments. An existing long-term syndicated loan contains covenants that may limit the company’s financial flexibility and in turn put pressure on the ratings, according to Fitch, which adds that Idesa will evaluate alternatives if the bond offering does not take place. Idesa co-sponsored the Etileno XXI project in Mexico with Brazil’s Braskem, which closed a $3.2bn loan package in December 2012. Pacific Rubiales (BB+/BB+/Ba2) has raised funds recently, but there is still some question as to the extent of the appetite in the LatAm bond market for lesser-known or first-time high-yield issuers. Brazil’s CBC (B1) and Peru’s AIH (BB minus) were the last, completing deals of $250m and $115m, respectively, in early November. This week could see a transaction from Hochschild Mining (Ba1/BB+).
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Sigma Advances Acquisition Financing
Mexico’s Sigma Alimentos is organizing a $1bn senior unsecured term loan facility, LatinFinance understands. The 5-year loan comes at Libor+125bp and is tied to a leverage grid. If the leverage ratio is less than or equal to 3x, the margin steps up to 137.5bp in year four, and 150bp year five. At more than 3x, the margin steps up to 150bp in year two, 162.5bp in year four and 175bp in year five. Bank of Tokyo-Mitsubishi is leading. There is a 20bp extension fee applied at the beginning of year four, and again at the beginning of year five. The Grupo Alfa food products subsidiary is making a EUR675m ($908m) bid for European meat company Campofrio Food Group. It is also planning an IPO with Citi, Goldman Sachs, Bank of America Merrill Lynch and Banorte-Ixe.
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Spaniard Moves for Cruz Blanca
Spain’s Grupo Bupa Sanitas has moved to acquire control of Chile’s Cruz Blanca Salud from the Said Somavia family, Cruz Blanca says, paying a 43.6% premium in an offer that values the health care provider at about $638m. The Spanish health care company is to pay CLP525 ($0.98) per share for 50.1%-56.0% of Cruz Blanca, depending on the results of a public tender. The price compares to a CLP365.52 closing price Friday. Shares closed at CLP Monday. Bupa Sanitas plans to begin the public tender offer in January. The Said family plans to retain a minority stake.
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DF Prices Domestic ABS
The government of Mexico’s Distrito Federal has issued MXP2.13bn ($162m) in domestic bonds, according to regulatory documents. The 10-year fixed-rate notes pay 7.05%, and are backed by future revenues passed down from Mexico’s federal government. The capital city’s government is raising money to fund infrastructure projects and to repay debt, and had been targeting up to MXP3bn. Santander managed the transaction, rated AAA on a national scale. In November of last year, DF sold MXP2.5bn in 15-year bonds at 6.85%, or Mbonos+85bp. Coming up this week, Fibra Uno will look to raise MXP13bn-MXP18bn in the first bond sale from a Fibra real estate fund. The transaction was postponed from last week. In an other deal moved to this week from last, Banco Interacciones is targeting MXP1bn Wednesday.
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Brazil Hikes, Colombia Holds
Brazilian officials decided unanimously to raise the country’s benchmark interest rate 50bp to 10.00%, while Colombian officials were also unanimous in a vote to hold theirs at 3.25%. Brazil’s move was expected, with analysts expecting a slowing at the next meeting in January. Several shops noted a change in the bank’s message, which had been consistent through the previous meetings. “With today’s policy statement changes, the Copom left the door open to taper the pace of rate hikes from 50bp to 25bp, but the statement falls short of indicating whether the central bank is planning, or under what conditions, it plans to decelerate the pace of rate hikes,” Goldman Sachs says. The shop sees a 25bp hike in January, noting that the move will depend on data including inflation and the fx rate. “The Copom changed the text to signal, in our view, that the end of the tightening cycle is near,” says Itau, another calling for a 25p hike in January.
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Lala Leader Resigns
Alejandro Rodriguez has resigned as CEO of Mexico’s Grupo Lala, the dairy products maker says, citing personal reasons. Board member Arquimedes Celes takes his place. Celes was CEO from 2001-2012.
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Navistar Reopens MXP Bonds
Mexico’s Navistar has reopened its 2018 domestic floating-rate notes, adding MXP800mn ($61m), according to a regulatory filing. After receiving slightly more than MXP800m demand, the Mexican unit of the US vehicle manufacturer reopened the bond to match the original rate of TIIE+150bp. Proceeds will be used for general corporate purposes. The total size is now MXP1.8bn. Actinver managed the transaction, rated AAA on a national scale.
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Bahamas to Meet Buyside
The Bahamas plans to start fixed-income investor meetings today, according to people familiar with the matter. The sovereign is visiting accounts in London, Boston and New York before finishing in Los Angeles Friday. JPMorgan and RBC are managing. A3/A minus Bahamas last sold $300m in new 2029 bonds at a yield of 7.0% in 2009. The sale through RBC and First Caribbean drew nearly $400m in orders and was upsized from $250m. The 2029 bonds were seen trading to yield 5.75% last week.
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European Clinches Dominican Teleco
Orange has agreed to sell its Dominican Republic business to Luxembourg-based telecom Altice for $1.44bn, the two say. Lazard advised Atlice on the transaction. The buyer has committed financing from Goldman Sachs, CFO Dennis Okhuijsen tells LatinFinance, and would likely tap the European bond market for more permanent financing, ideally before the end of the year. The transaction, subject to approval by Dominican Republic authorities, will be submitted to the board of directors of Orange during the week beginning December 9. For Orange, the deal is a step in the streamlining process it started in 2011. Orange Dominicana provides mobile telephone and Internet services to retail and business customers in the Dominican Republic. It had 2012 revenue of EUR451m ($613m) and 3.4m subscribers at the end of September.