Pemex is preparing to meet bond investors in Europe next week, according to people familiar with the matter. Starting Monday, the Mexican state-owned oil producer will visit London, Frankfurt, Amsterdam and Paris, finishing Wednesday. BBVA, Credit Suisse and HSBC are managing. A transaction may follow if market conditions permit. Pemex last issued in euros in 2009, pricing a EUR1bn 2017 at 99.311 with a 5.500% coupon to yield 5.623%, or mid-swaps plus 250bp. When laying out international issuance plans for 2013, company officials had said they would monitor the euro market as well as some South American currencies – Peru and Colombia the most likely – for potential issuance in addition to USD. Pemex also plans to become a more regular Mexican domestic market issuer. Its last visits to the international bond market were US Export-Import bank-backed deals in September and October, raising $350m and $750m.
Category: Regions
CFE Hits Domestic Market
Mexico’s Comision Federal de Electricidad (CFE) has raised MXP10bn ($768m) in the country’s domestic bond market. The state-owned utility sold new 10-year bonds and retapped five-year floating rate notes, in a Mexican market that remains open and active. CFE priced MXP6.75bn in the 2023 at 7.77% or Mbonos+145bp, on the wider end of 130bp-140bp price talk, according to people familiar with the terms. The 2018 reopened for MXP3.25bn at a 100.085 price and TIIE+13bp, flat to secondary levels and inside of the original TIIE+15bp pricing. Demand topped MXP16bn with the fixed-rate tranche seeing MXP11bn in orders from a diverse set of investors. The issuance is rated AAA on a national scale, and was managed by Banorte-Ixe, BBVA Bancomer, Santander and HSBC. CFE’s previous domestic sale was in June, when the issuer originally priced the 2018, to raise MXP12bn.
Mexican Leasing Company Completes ABS
Mexican equipment leasing company Arrendadora y Soluciones de Negocio has raised MXP550m ($44m) through a domestic accounts receivables securitization, according to bankers familiar with the transaction. The 4-year bond priced at TIIE+175bp, and total demand topped MXP596m. BBVA and Scotiabank managed the transaction, rated AAA on a national scale. It was the issuer’s first bond since a MXP300m sale last year, done at TIIE+160bp.
Salsa Maker Prices Local Bond
Grupo Herdez has issued MXP3bn ($230m) in fixed and floating-rate domestic bonds, according to people familiar with the transaction. The maker of salsas and other food products priced a MXP2.0bn 10-year fixed rate bond at 8.02%, or Mbonos+170bp, at the wide end of 160bp-170bp guidance. It also priced a MXP1.0bn 5-year bond at TIIE+54bp, in line with guidance. The issuer is rated AA on a national scale, and is raising proceeds to improve its debt profile and for general corporate purposes. BBVA Bancomer and HSBC managed. The borrower’s previous domestic deal was a MXP600m 2015 bond done in 2011 at TIIE+60bp.
Fitch Raises Outlooks for BBVA, Santander Units
Fitch has changed the rating outlooks for BBVA Colombia and Banco Santander Chile to stable from negative, it says, following similar moves at the parents. BBVA Colombia (BBB) and Santander Chile (A+)
each remain core to their parents’ global business, Fitch says. All of the pair’s regional subsidiaries have generally maintained strong balance sheets and robust performances through the crisis and contributed on average about 25% of their profits since 2010. The subsidiaries should also help shield the banks from softer numbers inside Spain.
PdVSA Talks Bond Sale
Petroleos de Venezuela (PdVSA) plans to sell $4.5bn in new bonds this week in a private placement, according to public remarks made by Oil Minister Rafael Ramirez cited in wire and local press reports.
The debt sale would be the first out of Venezuela this year, and would help the company to meet its commitments through the end of the year. The official did not give details about maturities or pricing. PdVSA has not issued bonds since a $3bn sale in May of 2012, and the Venezuela sovereign has been out of the market since 2011, according to Dealogic data.
HSBC Mexico to Issue Rare Local Bond
HSBC Mexico plans to issue up to MXP5bn ($379m) in the domestic bond market, according to people familiar with the deal, what would be the bank’s first domestic deal in four years. The Mexican arm of HSBC Holdings is selling 5-year floating-rate bonds and 10-year fixed-rate bonds, with pricing tentatively scheduled for December. Proceeds would help fund the bank’s portfolio. HSBC’s own capital markets arm is managing the transaction, rated AAA on a national scale. Its last domestic offering was a MXP4.180bn subordinated bond sale in June 2009.
Pepsi Bottler Readies Debut
Mexico’s Cultiba is preparing to raise up to MXP1.2bn ($91m) in what would be its domestic bond market debut, according to regulatory filings. The beverage company is targeting 5-year floating- rate notes to raise funds for general corporate purposes. Banorte-Ixe and Santander are managing the transaction, rated AA/AA minus on a national scale. Cultiba has a license from Pepsi to produce, distribute and sell Pepsi and several other brands and is also involved in the production of cane sugar and molasses. The issuer formerly known as Embotelladoras Unidas raised MXP3.94bn ($310m) in an equity follow-on in January that largely served as a re-IPO.
Vitro Nears Domestic ABS
Mexico’s Vitro plans to price a domestic ABS of up to MXP1.2bn ($91m) Thursday, according to people familiar with the transaction. The 3-year floating-rate deal backed by accounts receivables would be the glassmaker’s first local bond since before its bankruptcy process. Proceeds will be used to fund operations. The issuance is rated AAA on a national scale and led by BBVA Bancomer and Banorte-Ixe. Vitro last priced a domestic bond in 2005, raising MXP550m, according to Dealogic data.
Guatemalan Waits on Bond Debut
Guatemalan sugar producer and exporter Ingenio Magdalena has decided to postpone plans to issue its first international bond, citing pricing disconnect and treasury volatility, Rudy Maza, the issuer’s financial planning and risk manager tells LatinFinance. “We will look for a new window in 2014,” he says. He highlights a widening of the 10-year UST to 2.77% and a preference to revisit debut bond plans under more favorable market conditions and following the February US Fed meetings. With Brazilian sugar producers trading in the high double digits, Maza notes the difficulty in convincing buyside investors to buy into a challenging sector. “That was the main challenge, but Ingenio Magdalena is not Brazil,” he says. Magdalena found recent Guatemala deals trading in the 7%-area as interesting pricing points for its debut, despite differences in rating and sector. Ingenio was looking for a $400m bond transaction, according to Fitch, which assigned a BB minus rating, at a 5-10 year maturity. The issuer was raising funds to refinance existing debt and for general corporate purposes. Citi and JPMorgan were managing the BB minus/BB minus transaction. After six cross-border transactions pricing last week, no new issuers have stepped out on the road to refill the pipeline. Coca-Cola Femsa, among the group marketing last week, finished a roadshow Thursday without any indication of a deal.