Minera Frisco, the Mexican mining company controlled by Carlos Slim, has named Alejandro Aboumrad as CEO. He replaces Justo Wong, who resigns for personal reasons. Aboumrad was previously CEO at Slim’s infrastructure company Ideal. Frisco was spun off in January from the Crupo Carso holdco.
Category: Regions
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Banco de Chile Inches Closer to MXP Debut
Banco de Chile seems to be moving closer to its local Mexican bond debut after S&P assigned an AAA national scale rating to the proposed MXP2.5bn ($186m) issue. The borrower is expected to come with an up to 3-year tenor after earlier filing a shelf to issue up to MXP 10bn of debt in the local Mexican market. Banco de Chile will be the third Chilean issuer to tap the Mexican domestic market following similar moves by Banco de Credito e Inversiones (BCI) and Chilean miner Molymet. Banamex and JPMorgan are leads.
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Cemex Avoids Margin Step-Up
Mexico’s Cemex has made a $131m final prepayment under its 2009 financing agreement, allowing it to avoid a 50bp hike in interest expenses and saving it $37.5m annually, Maher Al-Haffar, the cement company’s VP of investor relations, tells LatinFinance. “We have done a lot of things in the first part of this year and last year to avoid step-ups,” he says. “We are comfortable, as our next maturity is not due until 25 months from now.” The company has now reduced the outstanding amount on the financing agreement by about $7.66bn – more than half of the original $15bn originally owed on bank loan. “This is definitely positive and gives us calm,” says Jerry Orosco, a Cemex bondholder and VP at Intercontinental Asset Management. Cemex 2020 bonds jumped a point yesterday to 68.5 on the back of the news. The company is expected to issue third quarter results next week.
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Iochpe Buys Mexican Parts Supplier
Brazilian commercial and light vehicle parts producer Iochpe-Maxion has agreed to acquire Grupo Galaz, a Mexican auto parts supplier, for $195m. The move comes as part of Iochpe’s plans to expand globally – the company earlier this month announced the $725m acquisition of US-based auto-parts supplier Hayes Lemmerz. Apart from a small-scale military vehicle chassis export program, this is Iochpe’s first step toward moving into the chassis business in the US market, a company official says. The Mexico acquisition makes sense in this context, given its proximity to the US and the difficulty of exporting such heavy equipment from Brazil. The Grupo Galaz announcement means Iochpe can now reach the same types of customers as it has in Brazil. The deal with Grupo Galaz, which produces side rails for commercial vehicles and supplies North American component makers, was handled internally, he says. Grupo Galaz reported net sales of $133.7m from January to August 2011, according to filings. The deal is subject to approval.
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Santander Retaps in Mexican Market
Santander reopened its 2016 bond Wednesday for another MXP1.3bn ($96m), pricing the transaction at TIIE+50bp, says a banker on the deal. The original MXP2.8bn issue was priced at the same spread in September. The bonds are rated AAA on a national scale. Proceeds from the self-led deal will be used for general corporate purposes.
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BPZ Set for Lima Listing
BPZ Resources, the US-based E&P company operating in Peru and Ecuador, has been approved to list on the Lima Stock exchange. The timing remains to be determined. BPZ does not announce any new equity capital to be raised in Peru.
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Newland Creditors in Informal Discussions
A majority of creditors holding US$220m in 9.5% 2014s issued by Newland International Properties are in informal discussions as they await a response from the company regarding a $31.4m payment due in November. The borrower will need more time but bondholders are likely to show some flexibility on payments rather than force an acceleration that would trigger a default, say an institutional investor. Newland has hired Gapstone as a financial advisor and is working on a proposal to put to creditors. “Everyone wants to be constructive. Everyone believes the sponsors have integrity and have done the right thing,” the investor adds. Hopes are that the Panamanian resort will be able to turnaround slumping sales by adjusting the cost structure. “Credits want to see what the company advises before they decide to get more organized or seek legal counsel,” he adds. The bonds are now being quoted in the 70s though no trading is taking place. This comes after Fitch downgraded the senior secured notes to CCsf in late September, citing delivery delays on finished units for the Trump Ocean Club hotel developed by the borrower. As of June 30, Newland held $12.8m in restricted cash, of which $10.5m was slated for a debt service reserve account, the agency said at the time. It noted that debt service was becoming dependent on collections from present and future unit sales. Newland International issued the $220m 2014 NC3 bonds in 2007 via Bear Stearns, pricing them with a 9.5% coupon to yield 10.25%.
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UNE Readies COP Bond
UNE EPM Telecomunicaciones, the telecom unit of Colombia’s Empresas Publicas de Medellin, plans to sell COP200bn-COP300bn ($102m-$153m) of domestic bonds on Thursday. The deal originally intended to hit the market in September features 7 and 12-year tranches each paying a spread to the IPC. Correval is managing the sale, rated AAA on a national scale.
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Banregio Preps MXP Issue
Mexico’s Banregio has filed a shelf to issue up to MXP5bn ($374m) in the domestic market. The bank has given no details on timing or structure. Ixe is managing the program. Banregio last tapped the domestic bond market in June 2007 when it priced an 8-year MXP750m floater at TIIE+130bp. BBVA Bancomer led the 2007 transaction.
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Venezuela Limits Allocations, Supply
By placing about 60% of its new $3bn 2026s among public sector banks, Venezuela is in effect limiting short-term supply damage in the international markets as much of the paper will be drip fed through the country’s FX platform, or Sitme, says Barclays. “…[banks] are expected to sell this bond to the central bank so that it can resell it through the Sitme,” the shop noted Monday after the government released the final results of the transaction. While international investors may be relieved that supply will be limited, the government’s strategy is less positive for Venezuelans which will receive fewer hard currency assets than they might have expected and will suffer from further upward inflation pressures as a result, it added. Public financial entities were allocated 100%, while insurance companies got about 82% of what they bid on. Pricing on the 11.75% bond was set last week at 95 last week. Credit Suisse acted as sole lead manager and coordinating agent along with Evorfinance Mosnarbank.