The Inter-American Investment Corporation (IIC) will use a $50m, 10-year term loan from the Nordic Investment Bank to promote renewable energy projects in Latin America and the Caribbean. The facility provides the flexibility of tapping different maturities. “These projects are long term so this facility matched the project,” says Juan Eduardo Zuluaga, IIC’s finance and risk management division chief. The interest rate will be defined at the time of disbursement, but can either be fixed or over Libor. He adds that the spread, which will be negotiated every time the IIC has a request, will be priced related to its AA rating. “The loan is the first step to create a strong relationship with the Nordic Investment Bank,” he says.
Category: Regions
Posted inDaily Brief
Pemex Preps MXP Bond
Mexican state-owned oil company Pemex plans to issue up to MXP10bn ($735m) in the domestic market, market conditions permitting, says a Pemex spokesperson. “Given the current volatility, windows have been opening and closing quickly. When the next window opens we will look at executing a transaction,” he adds. So far, Pemex has filed its next proposed issuance under its MXP200bn bond program with Mexico’s CNBV. The proposed MXP10bn fixed-rate bonds will carry a 10-year tenor and will be guaranteed by Pemex-Exploracion y Produccion, Pemex-Gas y Petroquimica Basica and Pemex-Refinacion, according to Moody’s. The ratings agency has assigned a Baa1 global scale local currency and Aaa.mx national scale ratings to the deal. Pemex last sold a total of MXP10bn ($740m) in floating and UDI-denominated bonds in September. The MXP7bn 2017 floating rate bonds priced at TIIE +24bp and MXP3bn in 10-year UDI-denominated bonds came at 3.55%, or MBonos+95bp.
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Loan Trading Increases As Europeans Shed Assets
European banks are increasingly shedding USD asset in the Latin American secondary loan market as they look to comply with capital requirements and retrench in the region, say bankers. But so far the sell-off seems to be an orderly one as there is more than a fair share of willing buyers, particularly among local institutions. Traditionally the domain of investments banks looking to reduce exposure to certain credits, the LatAm secondary loan market has arguably received a boost from increased activity with prices largely falling in line with CDS levels. “It is not a fire sale,” says one banker. “There is not too much portfolio dumping, and sales are $5m, $10m and $15m [in size]. Local banks, whose cost of funding is relatively high in dollars, are heard taking advantage of such sales to stock up on credits they like.
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Scotia Makes Mexico DCM Hire
Scotia Capital has hired Roberto Guzman as director, debt capital markets, Mexico. Guzman previously worked as director of structured finance at Fitch Ratings, where he covered residential mortgage backed securities, commercial mortgage backed securities, asset backed securities and future flows issuances. He reports to Vinicio Alvarez, managing director, debt capital markets Mexico. Scotia was recently mandated, along with Bank of America Merrill Lynch (BAML) and HSBC, to take Mexican state-owed oil company Pemex on investor meetings in Canada.
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Bolivia in Discussions about Foreign Bond Foray
The Bolivian sovereign has been talking to 8 banks about raising at least $500m in the international bond market after sending out proposals (RFPs) earlier this year, says a spokes person at the ministry of finance. The sovereign is considering a 10-year 144A/Reg issue, marking what would be its debut foreign bond, at least in recent years. Proceeds from the Bolivia trade are expected to be used to finance investment projects. “We are taking advantage of better macroeconomic conditions to issue in the international market,” the spokesperson says. This comes after S&P revised its outlook on Bolivia’s B+ rating to positive, citing large infrastructure and investment projects that may benefit the country’s growth prospects. Moderate economic growth, steady inflation and a decline in net debt-to-GDP ratios all help support the country’s ratings. Bolivia is rated B+ by S&P and Fitch.
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Cofide Revives Bond Issue
Peru’s development bank Cofide could roadshow its long-awaited $500m 144a/RegS 10-year as soon as December, though January may be a more realistic option, say officials at the development bank. The deal has been on the backburner since Ollanta Humala’s victory in the June elections left much uncertainty about how the newly elected left-wing president would steer the economy. Now with those concerns somewhat assuaged, Cofide is ready to move forward after completing talks with auditors. Officials see a final spread of 150bp over the sovereign as acceptable, though tighter pricing would be better. Deutsche Bank and JPMorgan have been mandated on the trade.
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Lindley Heard Eyeing $300m-$350m 10-Year
Peru’s Corporacion Lindley, a non-alcoholic beverages company, is telling investors that it is looking to raise $300m-$350m through a 10-year bond, says an account who met the company this week. The BB+/BBB minus borrower has already seen investors in Lima, Santiago, London and New York. It will head to Boston today and will wrap up in Los Angeles on Thursday. The new issue will bring net-debt-to-Ebitda to around 4x, but there are plans to reduce that to 2.5x by 2015, assuming 9% growth, the investor says. Accounts are heard discussing a 7% handle, though some put it higher. Citigroup and JPMorgan are managing the process. The Lima-based company produces, bottles, and distributes Inca Kola among other carbonated and non-carbonated drinks such as fruit juices, isotonic beverages, energy drinks and mineral water. Lindley has strategic alliances with The Coca-Cola Company. This would be the issuer’s debut bond offering abroad.
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AMX Reaches 93% of Telemex
America Movil has reached 92.8% ownership of Telemex, according to preliminary results of its public offer to buy up the 40% it didn’t already own. About 5.9bn Telmex shares were tendered in a transaction that should cost AMX about MXP62.15bn ($4.58bn). AMX offered MXP10.50 per share, and plans to delist Telmex, as part of a reorganization effort to get all of the Mexican billionaire Carlos Slim controlled telecom assets under one roof.
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Bancomer Files Multi-Currency Shelf
Mexico’s BBVA Bancomer has filed a shelf to raise up to $1.5bn equivalent in various currencies. The structured bank bonds may be issued in MXP, USD, EUR, PEN, CLP, or COP, as well as the UDI or UF inflation linked units. The Mexican banking unit of Spain’s BBVA does not give details as to timing or size of any specific issuance.
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Trafigura Preps Launch of Asset-Based Loan
The Mexican subsidiary of global trader Trafigura could launch an up to $350m 1-year asset-based loan into general syndication as soon as this week after wrapping up roadshows among Latin American banks. Bookrunners are BNP Paribas, Bladex and Scotia bank, with Banco do Brasil also heard participating. The structure is unusual for LatAm investors, but Trafigura is heard looking to diversify its funding base beyond its relationship lenders. Size will be based on a percentage of the underlying worth of the collateral, which in this case will be metal inventories and receivables. The structure requires the borrower to consistently demonstrate it holds a sufficient amount of assets to support the loan. While rare in LatAm, the structure has been used in a similar manner in Colombia, where BNP Paribas also led a $180m reserve-base facility for Pacific Rubiales to finance oil and gas exploration. In that case, the value of the borrowing base was amended twice a year. Trafigura is one of the world’s largest independent traders in the oil and non-ferrous concentrates markets.