Colombia’s Pacific Rubiales has agreed to pay $41m for 19% of Toronto-listed CGX, which holds rights to offshore and onshore fields in Guyana. The sale comprises 58.7m common shares of CGX at a price of $0.70 each. The deal is contingent on CGX completing an $80m bought deal financing with GMP Securities, Canaccord Genuity, Macquarie, Jennings Capital and Toll Cross, done at the same $0.70 price.
Category: Regions
Posted inDaily Brief
Mexico Holds Rates
Mexico’s central bank decided to hold its benchmark rate at 4.5%, in line with market expectations, though it left the door open for future cutting. “[The bank] remains alert to the perspectives for global economic growth and its possible implications for the Mexican economy, which in a context of great monetary lassitude in developed countries, could make a relaxing of monetary policy useful,” the bank says. Barclays calls for a 25bp cut at the next meeting. Nomura, however, sees a cut only if the European backdrop worsens significantly.
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Mexico’s Explores MILA Partnership
Mexico’s stock exchange is interested in exploring operational partnerships with the Peruvian, Chilean and Colombian bourses making up the Mercado Integrado Latinamericano (MILA). The Bolsa says no agreement has been made yet, but there are possibilities for investments or a strategic alliance. Executives from the Lima and Bogota exchanges have said that tie-ups with Mexico and Panama would be a logical next step for MILA. These types of expansions and the improvement of the existing cross-listing platforms are top priorities in the next five years.
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Holcim Ready for Mexico Debut
The Mexico unit of Holcim is still monitoring the domestic bond market to issue up to MXP2bn ($151m) in what will be its debut issue in this country. The cement company originally had plans to price last week subject to market conditions. The bonds, rated AAA on a national scale, will be guaranteed by its Swiss parent. Holcim is considering a 3-year floater and 10-year fixed rate bonds. Proceeds are to be used to refinance debt. BBVA Bancomer, Banamex and Santander are handling the transaction.
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Pemex and Sacyr United in Repsol Bid
Despite falling just short of having sufficient shares to take control of Repsol, Pemex and Sacyr-Vallehermoso are keeping their agreement to pool their resources in their bid for the Spanish oil firm. Together both companies now hold 29.5% of Repsol, putting them within spitting distance of the 30% required for a full takeover bid. The Mexican state-owned oil producer and the Spanish construction company agreed in August to pool their voting power to obtain maximum representation on Repsol’s board. Pemex has doubled its position to reach 9.49%, but is still shy of the 9.8% stake it committed to in the agreement. This comes after Pemex retapped its 6.5% 2041s last week for another $1.25bn, pricing it 102.131 to yield 6.339% or 315bp over. The bonds closed at 104.625 mid market Friday after strong day in the credit markets.
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Swedes Finish with 98% of Chile’s CTI
Swedish home appliances maker Electrolux has reached 97.79% ownership in Chile’s Compania Tecno Industrial (CTI), following the close of a tag-along offer. Electolux bought 64% of its Chilean peer in August for $691.5m equivalent from Sigdo Koppers, and has now spent an additional $570m equivalent. It offered investors the same CLP34.87 ($0.07) per share for remaining CTI shares and CLP325 per share for CTI’s listed Somela unit. CTI is to be consolidated into Electrolux this month.
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Banks Fund Brazil Fertilizer Project
The IFC, BNDES and Itau have agreed to a $158m equivalent A-B loan supporting Toronto-based MBAC Fertilizer’s Itafos-Arraias phosphate and fertilizer project. The IFC is to provide a $40m 8-year project finance facility. It pays a spread to Libor that the IFC declines to disclose. BNDES will provide BRL205m passed through Itau, splitting that amount into credit lines valued at BRL11.5m and BRL193.5m. BNDES and Itau did not respond to requests for comment on the facilities’ details. Proceeds will help fund the development of a phosphate mine along with the Itafos fertilizer plant.
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Chile Holds Rates, Mexico Next
Chile’s central bank chose to maintain the benchmark interest rate at 5.25%, in line with the market’s expectations. In a statement, the bank cited slowing global growth, and says that volatility could be worse than expected, with implications for Chilean growth, inflation and monetary policy. In a recent poll taken by the central bank, most analysts said they expect a cut to 5.0% by the end of the year. Mexico is scheduled to make its interest rate decision today. At its last meeting, Banxico held the benchmark rate at 4.5%, through many, such as Morgan Stanley see the door open for a 25bp cut by the end of the year.
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Liverpool Files MXP Shelf
Mexico’s Liverpool has filed a shelf to issue up to MXP25bn ($1.8bn) in the domestic market. The retailer has not given timing and size details. Banamex, BBVA Bancomer and HSBC are managing the program. Liverpool last tapped the domestic market in 2010 when it priced MXP2.25bn in 2020 bonds at 8.53%, or Mbonos+128bp, and MXP750m of 2020s in inflation-linked UDIs at 4.22% or Udibonos+92bp. Banamex and HSBC led last year’s deal. Liverpool is rated AAA on a national scale.
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CAF Returns to Swiss Market
Regional development bank CAF became the sole LatAm issuer to tap the international markets Thursday when it raised CHF125m ($139m) in the Swiss franc market. Upsized from an initial target of CHF100m, the long 5-year bond came at a reoffer price of 100.264 with a 2.75% coupon to yield 2.697% or mid-swaps plus 185bp. CAF has become a frequent issue in this niche market. In January, it reopened its 2.625% of 2015s to raise CHF130m. At the time, the borrower said that pricing came inside its dollar curve after it retapped the bond at 99.791 to yield 2.774%, or mid-swaps plus 140bp.