Avianca is scheduled to price today the equity follow-on marking the debut of the ADS representing preferred shares of the Avianca Holdings entity. The transaction is offering 12.5m primary ADS and 14.7m secondary ADS at $17.00-$20.00 each, meaning a $579m sale at the midpoint if a 15% all-secondary greenshoe is included. Each ADS represents eight Avianca Holdings preferred shares. The preferred shares were last seen trading at COP4,265 ($2.43) each, according to the Colombian Bolsa, or what would be $19.44 per ADS – though people following the sale expect it to price at a discount to the domestic shares’ level. The secondary portion is to be sold by former Taca executives Juaquin Palomo and Alfredo Ratti and the entities representing the controlling Eframovich brothers and Kriete family. The Eframovich brothers should control a position equal to 78% of the common stock following the deal. The Panama-domiciled Colombia-listed holdco is raising funds to modernize the Avianca-Taca fleet. JPMorgan and Citi are leading the transaction, joined by UBS, BTG Pactual and Deustche Bank. Avianca and Taca merged in 2010, and the domestic IPO of the preferred shares raised $283m-equivalent in 2011. The environment for Airline equity deals has been mixed, with Brazilian Azul electing to wait until next year for an IPO. Mexico’s Volaris has traded up more than 11% through Monday since a September IPO that came at the bottom of the range.
Category: Regions
Moody’s Negative on Bancolombia
Moody’s has changed the outlook Bancolombia’s Baa3 ratings to negative, it says. The move follows a review initiated in February after Bancolombia agreed to buy HSBC Panama, which the agency sees possibly pushing the Colombian bank’s capital ratios down. Bancolombia closed the $2.23bn HSBC Panama deal, as well as the $217m purchase of 40% of Banco Agromercantil in Guatamala, last month. Moody’s says it expects capital ratios to stay low over the next 6-12 months, but adds that raising more capital would boost Bancolombia’s credit outlook. “The bank’s shareholders gave approval last February for a capital injection of about $2.2bn, which if carried out would improve Bancolombia’s loss absorption capacity,” Moody’s says.
Peru Holdco Aims for Single Digits
Peru’s Andino Investment Holding (AIH) is heard starting at 10%-area initial price talk for a $130m 2020 NC3 bond, according to sources close to the deal. Pricing could come as soon as Wednesday. The trade and transport-focused holdco is looking for funds to repay $86.5m in bank debt and finance $43.5m in capex. Bank of America Merrill Lynch, Credicorp and Goldman Sachs are managing the B+/BB minus transaction. Last year, AIH raised $43m in the ECM and sold $110m in bonds at its Terminales Portuarios Euroandinos unit, in a sale managed by Goldman Sachs.
HSBC Mexico Adds Equity Head
Francois Jaubert has joined HSBC Mexico as head of equity, where he will focus on sales and trading for the cash and derivatives business in the equities group, according to a person familiar with the move. He last worked at Deutsche Bank, where he was head of equities until November 2012, when he left to pursue personal interests. Prior to the six years Jaubert spent at Deutsche Bank, he worked 11 years at Merrill Lynch in a similar role.
Mexican Miner Talks Price
Mexico’s Cobre del Mayo (CDM) is out with 11%-area price talk for a $200m-$250m bond, according to sources close to the deal. Executive chairman John Detmold told LatinFinance last week Cobre was targeting a bond with a likely 5-year tenor at that range. The roadshow, extended through today, will look to price this week. A deal would represent an international bond market debut for the B3/B Mexican mining company. CDM would refinance most of its total debt of $210m with the proceeds, pushing out the maturity profile to 2019. It also has a $100m undrawn unsecured revolving credit facility available from Banco Azteca expiring in 2021. To determine pricing, CDM has been looking to single-B credits like Marfrig’s 2020, seen trading around 10.3%, and Gol’s 2020, around 11.5%. Cobre’s liquidity position is sufficient for the rating category, according to Fitch ratings, which notes a position including $6m cash and marketable securities, $22m in short-term debt, and 2.1x total debt-to-Ebitda. Jefferies, BCP Securities and Nomura are managing the RegS-only process. The issuer operates Mexico’s third-largest copper mine, Piedras Verdes. CDM is 71.24% owned by Frontera Copper Corporation (FCC) of Canada, a company in turn 100% owned by the Mexico’s Invecture Group, with the remaining 28.76% owned by Lawrie Associates. Opening in 2006, development of Piedras Verdes was suspended in 2008 due to low copper prices, sold to Invecture in 2009, and restarted.
Bank Reveals Yield Target
Banco de los Trabajadores (Bantrab) is looking at a yield in the low-9% range for a new $150m 2020 bond expected to price Wednesday, according to people following the transaction. The Ba3/BB Guatemalan lender completed a European, North American and Central American roadshow last week. Bantrab is seeking funds to refinance debt and support its growth efforts. Deutsche Bank and BCP Securities are managing the deal, done through a Cayman Islands SPV. When assigning its rating, Fitch cites improved asset quality, an ample net interest margin and moderate but sustained profitability ratios. Bantrab was established in 1965 and is mainly retail-oriented and focused on consumption loans to low and middle-income employees. It is currently the sixth-largest bank in Guatemala in terms of assets. An international bond would be only the second-ever from a Guatemalan bank, according to Dealogic data, following Banco Industrial’s $500m sale last year.
CFE Wants Domestic Bond This Week
Mexico’s Comision Federal de Electricidad (CFE) plans to raise up to MXP10bn ($766m) in a two-tranche domestic bond sale, now set for Wednesday, instead of next week, according to people following the sale. The proposed 5-year notes would pay a spread to the TIIE and additional 10-year notes a fixed-rate. The issuance falls under a MXP100bn program, and is to be managed by Banorte-Ixe, BBVA Bancomer, Santander and HSBC. The government electricity monopoly’s most recent domestic bond was in June, when the issuer priced a MXP12bn ($911m) floating rate note via Banorte-Ixe, HSBC and Santander. CFE is rated AAA on a national scale.
Fibra Uno Readies Local Bond
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.
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.
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.