The government of Aruba will meet fixed-income investors next week in Europe and the US, in a possibly prelude to a $253m, 11-year senior unsecured bond issue. Meetings will begin in London on September 3, followed by New York on September 4, Boston on September 5 and possibly Los Angeles on September 6. Fitch assigns the bonds a BBB rating with stable outlook. Proceeds will be used to address $88m in external maturities and to cover budgetary requirements, Fitch says. Credit Suisse and UBS are managing. Aruba last visited the bond market in February 2008, pricing a $57.3m 5-year issue.
Category: Regions
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Mexichem Seeks Equity, Debt Sale
Mexican industrial conglomerate Mexichem has taken initial steps in a financing plan that would consist of $2bn in equity and debt, the company says, as it seeks to refinance existing debt and address working capital. It aims to raise $1bn via a capital increase and a separate $1bn portion in USD long-term debt. Pending National Banking and Securities Commission (CNBV) and Mexican Stock Exchange (BMV) approval, Mexichem would pursue a primary public offering among investors in Mexico, with distribution in other markets abroad, while the debt portion would be issued in the international bond market. “The company will call an extraordinary general shareholders’ meeting where the corresponding capital increase shall be proposed, as shall the suggestions that it be made through a public offer. Should it be approved, the existing shareholders will not have a preemptive right,” it says. The proposed deals are subject to various approvals and suitable market conditions.
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Belize Bondholders Seek Key Details
The Coordinating Committee of Belize Bondholders will conclude that the central American nation does not face debt sustainability issues – contrary to the government’s central claim – if authorities do not make available additional details of its national accounts, the ad hoc group says in a statement. The committee says it needs the information to wrap up its initial evaluation of the government’s fiscal projections in advance of a meeting with officials in which agreement will be sought on a fair analysis of debt sustainability. “In the absence of complete disclosure from the country, the committee views the IMF Article IV report published last December, in consultation with the government of Belize, as the definitive active financial analysis for Belize,” the committee says. “That report did not highlight a debt sustainability concern, and the committee is seeking to understand the key assumptions underlying Belize’s current DSA and the basis for why it differs so materially from the IMF’s analysis.” Mike Gerrard, the ad-hoc group’s financial advisor and Managing Director at BroadSpan, says: “Contrary to some recent reports, we have been in a fairly continuous dialogue with Belize’s financial advisors for several months. We do however, need to receive from the government the information necessary to complete our analysis before meaningful discussions can take place.” The government of Belize entered a 30-day grace period following its failure on August 20 to make a $23.1m coupon payment on $543.8m in outstanding 2029 “super bonds”. The bondholder committee represents almost 60% of the outstanding size of the super bond, or more than $325m of the outstanding super bond debt. The bonds were trading Tuesday at 37-38 cents on the dollar.
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Bancolombia Board Approves Issue
The board of Bancolombia has approved an international bond issue of up to $1.2bn, the bank says in a regulatory filing. The Colombia-based lender plans to issue subordinated notes for up to 10-years, it says. Proceeds of the international notes would be used to support lending operations.
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Brazil Rate Cut Expected
Brazil’s central bank is expected to cut its Selic rate today by 50bp to a new record low of 7.50%. In July, Banco Central do Brasil cut its benchmark rate from 8.5% to 8.0%, a record. “The main uncertainty lies with October’s meeting from which we expect a final 25bp cut of Selic rate while many analysts forecast Copom will remain on hold,” says Citi in comments ahead of the decision. The statement that follows today’s meeting should provide some indication of the likely future direction of interest rates, Citi notes.
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Finandina Issues Bonds
Colombia’s Banco Finandina concluded a COP200bn ($110m) issuance program Tuesday, pricing a COP27.6bn private placement maturing May 2015, at 100.061 with a DTF+1.99% yield and spread of 220bp over fixed-rate government bonds with the same maturity. Corredores Asociados, Correval, Interbolsa, Bancolombia, Casa de Bolsa and Serfinco led the transaction, say sources familiar with the deal. The transaction, which saw over 3x demand, completes a program that began last August with COP72bn, followed by COP100.5bn in May. In August 2011, Finandina’s issue saw some COP97bn in demand. It sold a COP41bn 2013 tranche paying the IBR+2.09%, a COP12bn 2014 piece paying IBR+2.50%, and a COP19bn 2016 inflation-linked portion paying 4.20%. In May, it issued a COP64.7bn 2015 series paying DTF+1.85%, a COP12.3bn 2016 series paying DTF+1.99%, and a COP23.5bn 2015 series paying IBR+1.84%. The bonds are rated AA on a local scale.
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Sodimac to Issue
Sodimac plans to issue up to COP300bn ($164m) in Colombia’s domestic market today. The home improvement unit of Chilean retailer Falabella can choose from a 5-year tranche with an interest rate of up to 6.90%, a 5-year tranche with an interest rate of up to IPC+3.80% and a 10-year tranche with an interest rate of up to IPC+4.20%. It plans to use proceeds to refinance debt and pay for expansion plans. Bancolombia and Correval are managing the deal, rated AAA on a local scale.
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Miner Names CFO
South American Silver has named Matias Herrero full-time CFO at the company. He replaces part-time CFO William Filtness, who takes on a new role as consultant to the Vancouver-based mineral exploration company. The appointment is part of an anticipated management change, the company says. Herrero previously worked as CFO at gold producer Rusoro Mining and has experience in international arbitration, mergers and acquisitions, debt and equity financings. Earlier this month, Gregory Johnson left his role as president. and CEO to pursue other interests. South American Silver has projects in Chile and Bolivia.
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Bachoco Price Talk Heard
Mexican poultry producer Industrias Bachoco is understood to be seeking to pay TIIE+70bp-area today on a new MXP1.5bn ($114m), 5-year floating-rate domestic bond. Proceeds will be used to refinance existing debt. Banamex is leading the transaction, rated AA+/AA. Industrias Bachoco operates poultry production and distribution facilities throughout Mexico. Aside from breeding, processing and marketing poultry, it also produces and distributes eggs, swine, and animal feed. Last year, it acquired privately-held Arkansas-based poultry producer OK Industries for $95m.
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Finandina Preps Local Issue
Colombia’s Banco Finandina is poised today to round out a COP200bn ($110m) issuance program with a COP27.6bn private placement maturing May 2015, at DTF+1.99%. Corredores Asociados, Correval, Interbolsa, Bancolombia, Casa de Bolsa and Serfinco will lead the transaction, say sources familiar with the deal. The transaction will complete a program that began last August with COP72bn, followed by COP100.5bn in May. In August 2011, Finandina’s issue saw some COP97bn in demand. It sold a COP41bn 2013 tranche paying the IBR+2.09%, a COP12bn 2014 piece paying IBR+2.50%, and a COP19bn 2016 inflation-linked portion paying 4.20%. In May, it issued a COP64.7bn 2015 series paying DTF+1.85%, a COP12.3bn 2016 series paying DTF+1.99%, and a COP23.5bn 2015 series paying IBR+1.84%. The bonds are rated AA on a local scale.