Ricardo Cano is heard leaving his position as BBVA Bancomer’s credit market head, with talk pointing to former UBS banker Antonio Castano as his possible replacement. Castano is currently director general of state development bank Nacional Financiera (Nafinsa) and like the bank’s recently appointed director general of global business, Alejandro Werner, he also worked at Hacienda in the early 2000s. Werner joined BBVA Bancomer earlier this year after three years as the country’s sub-secretary of finance. Castano, meanwhile, was hired by Nafin in early 2009 after working at UBS as an executive director in the LatAm DCM team and before that as deputy general director of public credit. Castano is heard leaving the government development bank on December 30, and is scheduled to commence a new role at BBVA Bancomer from January 2012. Cano started in the bank’s Mexico DCM group in 1997, and has held his current title since January.
Category: Regions
Fovissste Cuts Ribbon on New RMBS
Mexican government housing agency Fovissste has sold MXP4.309bn ($309.8m) in domestic inflation-linked bonds backed by mortgage loans. The 30-year UDI-denominated notes pay 4.60% and were priced at UDIbonos+283bp. The transaction was heard oversubscribed by 1.13x. Fovissste came wide to 4.50% area expectations and failed achieve the 4.45% seen on Infonavit’s MXP1.1bn 2039 issuance last week. Ixe managed Fovissste’s deal, rated AAA on a national scale. Fovissste had last sold MXP3.9bn ($317m) of UDI-denominated 2040 notes in August at 4.25%, or 296bp over UDIbonos.
ING Sheds LatAm Jobs
ING has shed jobs across its LatAm trading, research and DCM groups as the bank moves to comply with Basel III rules and set aside money for capital requirements, says a person with knowledge of the situation. Approximately 20 odd employees are heard being let go in New York and to a lesser extend in Mexico. While the cuts are seen reflecting the diminishing importance of LatAm for the Dutch bank, ING isn’t retrenching altogether. It has kept some research, sales and some DCM people on board, including some in Brazil, and will continue to focus on local currency and interest rate products in LatAm. Its EM hard currency business, however, is being abandoned.
Televisa Inks Spanish Equity Swap
Mexico’s Televisa has agreed to swap its 40.8% participation in Spain’s national broadcaster La Sexta for 14.5% of Spanish media holding company Imagina. The transaction will involve an equity stake swap with no money changing hands, Televisa says. Under the deal, Televisa will have the right to name 2 directors to Imagina’s 12-member board as well as participate with Imagina on joint content production projects. The deal also gives Televisa certain rights of first refusal to buy content and transmit sporting events. The transaction comes as Spain’s Antena 3 broadcaster moved to acquire La Sexta in a stock deal that would give La Sexta shareholders 7% of Antena 3, with an additional stake of up to 7% over a 5-year period subject to certain conditions. Televisa said that it will not receive Antena 3 stock given that its swap agreement contemplates surrendering its stake and rights to Imagina. A Televisa official could not immediately offer more details in terms of valuation of the assets swapped or which entities advised the companies. To advise on its own transaction, Antena 3 retained Morgan Stanley and Nomura, Deloitte and Ernst & Young as financial advisors, as well as law firms Clifford Chance and Ramon y Cajal. La Sexta hired Citigroup, KPMG and Ecija Abogados.
Afores Seek Returns in EM
Mexican pension funds should be given greater freedom to diversify into growing EM economies rather than be limited to investments in sluggish developed nations, say participants at a recent Mexico-US Chamber of Commerce event in New York. Rules that emphasize foreign investments in the US and Europe make little sense at a time when such options often present more risks than opportunities. “How is it that Mexico’s [pension funds are] allowed to buy Greek debt but can’t invest in most emerging economies?” asks Alonso Cervera, managing director of emerging markets and fixed-income research at Credit Suisse. At the moment, Mexico’s pension funds can invest in 40 eligible countries, but only four of them are emerging markets, namely Brazil, Chile, India and China. Regulators are aware of the dilemma and have expressed a willingness to loosen such restrictions. “There is a huge opportunity to move money to EM economies or fast growing Asian economies,” says Pedro Ordorica, president to Mexico’s national commission for retirement savings CONSAR. “We are pushing legislators to remove one of the most challenging things for us. Perhaps in the next administration.” For now, the Afores can only allocate 20% of their portfolios in foreign assets and about 60.6% of that is invested in the US, followed by Brazil at 14%. Perhaps because of the limited options Afores have yet to reach their foreign thresholds, with just $11.5bn, or 9.63% of total assets under management, invested abroad. Of that amount, most is dedicated to foreign equity (77.2%), with 22.8% in debt. Mexican pension assets under management now stand at $119.5bn, or 11.5% of the country’s GDP.
Marcopolo Buys Control of Aussie Busmaker
Brazilian bus body maker Marcopolo has acquired a 75% stake in its Australian counterpart Volgren Australia for AUD52.5m ($52.9m), with additional future earn-out adjustments. The Grenda family that founded Volgren will hold a minority stake in the business, but Marcopolo will retain an option to purchase the remaining 25% stake in 3 years time, the companies announced in separate statements. In addition to the purchase price, the deal between the bus makers includes an earn-out clause with an Ebitda floor for each of the following three years, Carlos Zignani, Marcopolo’s investor relations director tells LatinFinance. If the end year Ebitda exceeds the agreed upon floor, a multiple of 6x the excess will be multiplied by the 25% remaining stake and added to the AUD52.5m purchase price. In addition to the earn-out, the deal includes an option for Marcopolo to purchase the remaining 25% stake in the company at a multiple of 6x Ebitda, with an exercise date of June 2016. At that time, the value of the stake will be determined based on the average Ebitda of the previous 3 years. Based on Marcopolo’s estimates, the purchase price for the company came in at a multiple of 2.5x 2010 Ebitda of AUD21m. The transaction will be financed with AUD22.5m in cash and an additional AUD30m in debt, to be borrowed at a rate of anywhere between 6% to 7% from a yet-to-be-determined Australian bank, Zignani added. Volgren was advised by UBS, consulting firm MGI Melbourne and Australian law firm Arnold Bloch Leibler. Marcopolo retained PricewaterhouseCoopers to advise on the acquisition. The deal comes shortly after Petros, the Petrobras employee pension fund, announced it had increased its position in Marcopolo to 15% of preferred shares, or 9.29% of the company’s total capital.
Oaxaca Nears MXP Bond
The Mexican state of Oaxaca is close to raising MXP1.947bn ($140m) through the sale of a 15-year domestic bond. Pricing is scheduled for Thursday, if market conditions permit. The issuer is heard looking to pay between TIIE+125bp-130bp. Proceeds are marked for general corporate purposes. Interacciones is leading the transaction, rated AAA on a local scale.
El Paso Aims for 1Q Brazil Asset Sale
US gas company El Paso is expected to divest its Brazilian assets, along with the rest of its exploration and production business, by the end of the first quarter of 2012, says a person close to the transaction. Since the acquisition of El Paso by Kinder Morgan earlier this year, the pipeline company has been hawking its global E&P business in a sale that analysts estimate at $8bn. The bulk of the assets are the company’s US shale plays, but roughly 3% of the company’s total consolidated reserves, as measured in millions of cubic feet of natural gas equivalent, are located in Brazil, according to the company’s latest 10K filing. “The process is ongoing,” Bill Baerg, investor relations manager for El Paso, tells LatinFinance, referring to the sale. Baerg says the company plans to sell the bulk of its assets in one transaction but will have to seek different buyers if one single transaction is not viable. The company has retained Barclays and Evercore, the same firms that advised in Kinder Morgan’s $21.2bn acquisition of El Paso agreed in October. In Brazil, El Paso owns a 100% working interest in the offshore Pinauna and Camarao fields, a 25% stake in the Camarupim field and 35% stake in the Pescada-Arabaiana fields.
Pequiven Gets Nearly All in Tender
Petroquimica de Venezuela (Pequiven) is set to repurchase $247.6m in outstanding 8.29% 2020 bonds following the close of a tender offer, it says, or 99% of the $250m original face value amount. Most of the bonds were tendered prior to the December 6 early tender date. The petrochemical producer paid accepting holders $1,049.70 per $1,000 principal if they accepted by December 6, and $1,000 if after. Due to scheduled amortization payments, as of the November 22 launch date, there was $952.00 in principal for each $1,000 original principal, meaning about $238m needs to be spent in the buyback.
US Operator Buys Telefonica Mexico Towers
American Tower, a US operator of telecommunications towers and sites, has agreed to acquire 2,500 telecom towers in Mexico from Pegaso PCS, the Mexican subsidiary of Spain’s Telefonica, for $500m. Neither party involved in the deal hired financial advisors, and American Tower used its own in-house M&A group, say a spokeswoman for American Tower. Stearns declined to provide any valuation multiples for the purchase. The company said in a statement that the tower acquisition doubled its portfolio of assets in Mexico, a bet on the future growth of the telecom business in that country.