Mexico’s Fibra Uno real estate trust is planning to issue up to MXP10bn ($766m) in what would be the first-ever domestic bond placed by a Fibra fund, say bankers familiar with the deal. The real estate fund is considering up to three tranches, in tenors ranging from 5 years to 20 years in fixed-rate or Udi-denominated bonds, and is preparing a roadshow this month, a banker familiar with the process says. Proceeds will be used to refinance bank debt. BBVA Bancomer, Banamex, Credit Suisse and Santander are managing. Fibra Uno’s CFO Javier Elizalde told LatinFinance in June it was plotting a domestic bond issuance this year, with the issuer previously relying on banking lines for leverage. The fund was Mexico’s first Fibra to IPO, in 2011.
Category: Regions
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Mexican Looks to IPO
Mexico’s BanBajio is planning an IPO, likely in 2014, according to a person following the process. The lender has hired Bank of America Merrill Lynch, BBVA, Citi and Morgan Stanley to manage. The bank specializes in SME, consumer credit and mortgage financing. Last year a group of international investors including Singapore’s Temasek bought a 20% stake in Bajio for $208m, in a transaction representing the exit of Spain’s Banco Sabadell.
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Televisa to Add Local Debt
Mexico’s Grupo Televisa plans to raise up to MXP10bn ($766m) in the domestic bond market, as it continues a roadshow this week, say bankers familiar with the process. Under consideration are 10-year and 15-year fixed-rate notes. Proceeds will be used to refinance debt and for general corporate purposes. Banamex, BBVA Bancomer and Santander are managing the sale, rated AAA on a domestic scale. Televisa raised MXP6.5bn from the sale of global-local titulos de credito extranjero in May, getting 30-year funds at 7.27%, or Mbonos+185bp.
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Broker Taps Mexican Bond Market
Brokerage firm Grupo Bursatil Mexicano (GBM) has issued MXP1.2bn ($92m) in domestic bonds, according to people familiar with the transaction. The bond priced at TIIE+55bp, in line with TIIE+55bp guidance. Proceeds from the 3-year note will be used to replace existing debt and for working capital purposes. BBVA Bancomer, HSBC and GBM managed the transaction, rated AA on a national scale. The deal follows a May sale, in which the issuer priced a MXP650m 1.2-year floating-rate bonds at TIIE+25bp.
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Fibra Aims for December Window
Mexican developer Grupo Acosta Verde is targeting a November-December pricing for the IPO of its shopping mall-focused real estate fund for Mexico’s Fibra market, according to people following the sale. The fund, to be known as Fibra Sendero, would launch in early November to hit the next window, after filing ahead of the previous September-October window but opting not to launch. The fund will start with 10 operating malls spread throughout five Mexican states, and aims to acquire land to develop six more. The size and exact timing remain to be determined. Sendero’s malls are focused on the middle and lower-middle classes, also known as C and D classes. BBVA and JPMorgan are global coordinators on the sale, with UBS also on the international portion and Banorte-Ixe managing the local portion. The once-popular Fibra asset class has had it rough lately, with many trading down. Fibra Danhos, the most recent to IPO, priced at the bottom of the range and closed at MXP24.06 Thursday, versus the MXP26.00 IPO price.
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Chinese Clinch BicBanco Deal
China Construction Bank has agreed to buy Brazil’s BicBanco for BRL1.62bn ($723m), BicBanco says, bringing rumors to life and giving one of China’s largest banks its first foothold in Brazil. The deal for the 72% stake – consisting of 157m common and 25m preferred shares – comes at BRL8.90 per common or preferred share. This represents a premium to the respective BRL7.38 and BRL7.50 closing prices Thursday. The price is subject to adjustments. Following necessary approvals, CCB would move ahead with a public offer for the remainder of the bank’s shares. Citi advised the seller. CCB’s previous attempt to enter Brazil was a 2012 agreement for WestLB’s assets in the country. When the deal fell through, the WestLB operations went to Mizuho.
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Fitch Upgrades Alestra
Fitch has upgraded Alestra’s credit ratings to BB from BB minus, it says, based on an improved financial profile. The agency expects the Mexican telecom will have the ability to refinance the maturity of the $200m senior notes due in 2014, based on its proven access to the local bank and capital markets and the support and bank relationships of its parent Grupo Alfa. It also notes positive operational performance, stable and predictable cash flow generation, historical positive free cash flow and sound credit metrics. Alestra’s leverage level of 1.3x for the 12 months to June 30 is “moderate,” and Fitch expects 1.5x-2.0x over the long term. The outlook is stable. Alestra is rated BB/BB/Ba3, and was also recently upgraded by Moody’s and S&P.
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KOF Readies Acquisition Debt Takeout
Coca-Cola Femsa (KOF) is readying fixed-income investor meetings ahead of what would be an international bond sale replacing acquisition debt. The A/A2/A minus Mexican bottler will meet accounts in Boston, Los Angeles, San Francisco, New York and Chicago November 5-7. Escorted by Citi, Goldman Sachs, JPMorgan, HSBC and Mitsubishi-UFJ, KOF may follow with a deal if market conditions permit. The largest franchise bottler of Coca-Cola products closed this week the 100% all-cash acquisition of Brazil’s Industria Brasileira de Bebidas (Spaipa), at an enterprise value of $1.86bn, and was readying a $1.5bn 5-year loan led by Bank of Tokyo Mitsubishi, Mizuho and HSBC in September. Spaipa was the second of two purchases, following a $448m purchase of Brazilian Companhia Fluminense de Refrigerantes closed in August. Fitch estimates that KOF’s total debt-to-Ebitda and net debt-to-Ebitda will increase on a pro-forma basis to approximately 2.0x and 1.6x, respectively, by the year-end. In June, CFO Hector Trevino told LatinFinance that KOF would look tap the bond markets before US rates go up. The company has $300m of bank debt maturing this year. Its last bond was a $603m-equivalent domestic 10-year in May.
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Lender Prints MXP Bond
The Mexican subsidiary of Nissan-Renault’s NR Finance vehicle financing arm has priced a MXP3.0bn ($227m) domestic bond, according to a person familiar with the transaction. The 2016 priced at TIIE+30bp, flat to guidance, and received 1.19x demand. Proceeds will be used to substitute debt and for general corporate purposes. BBVA Bancomer and Bank of America Merrill Lynch managed the transaction, rated AAA on a national scale. NR Finance Mexico provides financing services for the acquisition of Nissan and Renault automobiles in Mexico. The issuer was previously in the domestic market in March 2012 when it raised a MXP2.5bn 2015 paying TIIE+50bp.
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Aval Prefers Domestic Equity Route
Colombia’s Grupo Aval is preparing to sell COP2.4trn ($1.27bn) in shares through an equity follow-on in the domestic market, it says. Given the conglomerate’s recent M&A activity, such a sale had been expected by the markets, though perhaps through the SEC process for which it registered earlier this year. The plan to issue in the US market will be postponed as Aval focuses first on this local sale, a spokeswoman says, noting that banks have not yet been hired. Aval does not give additional details. Corficolombiana, part of Aval, would be expected to manage the deal, as it did Aval’s last domestic equity transaction along with Corredores Asociados. A tap of the more familiar domestic investor base, where Aval can anchor with preemptive rights, might allow for the issuer to better control its pricing, say ECM bankers observing the process. “This announcement is a negative for Aval’s shares. Further, given the high trading and forward multiples of [Aval] today, the primary market could demand a considerable discount,” Credicorp says, noting a need for funds to support a busy M&A agenda. Aval completed in April the purchase of BBVA’s Horizonte Colombian pension operation for $530m, and is working on closing the $411m purchase of Guatemala’s Reformador and the $646m purchase of BBVA Panama, both expected to finalize as soon as November. An equity sale might be good for Aval’s bondholders, however, Credicorp says. “The recent M&A activity was constraining severely Grupo Aval’s unconsolidated cash position. This issuance then will improve the conglomerate’s financial health, and lowers the likelihood of further debt offer,” it says. Aval’s last equity deal was a $1.17bn-equivalent domestic follow-on in 2011. It had been seeking the SEC deal since, but has been content funding itself in the international bond market, including $1.6bn last year and $500m this year through its Banco de Bogota subsidiary. JPMorgan, Goldman Sachs, Citi and Morgan Stanley had been hired in asso