Peru’s central bank has decided to keep its benchmark interest rate at 4.25% for the fifth straight session, in line with the markets’ expectations. “The decision takes into account the slower growth seen in some areas of spending and production, as well as the increasing international financing risks,” it says.
Category: Regions
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UNE Postpones Local Bond
UNE EPM Telecomunicaciones, the telecom unit of Colombia’s Empresas Publicas de Medellin, is now eyeing the week of October 17 to place a COP300bn ($153m) domestic bond, according to a banker on the sale, after originally expecting to sell this week. In what would be the first local Colombian bond sale from a non-financial institution in several months, the issuer is able to chose among maturities of 1-15 years, paying a fixed rate or spreads over the IBR, DTF or IPC. Correval is managing the sale, rated AAA on a national scale.
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Peru Expected to Hold Rates
Peru is expected to keep its benchmark interest rate at 4.25% for the fifth straight session when the central bank meets today. Most analysts see a pause as the global economic slowdown is tempered by higher inflation, though some, such as Barclays, call for a 25bp cut. The bank left the door open to a cut in a September statement, if the global outlook continued to deteriorate. However, Central Bank head Julio Velarde said publicly September 21 that he saw no need to change monetary policy.
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AMX Gets Japanese Rating
Japan Credit Rating Agency has assigned an A rating with stable outlook to Japanese yen-denominated bonds from America Movil (AMX). The Mexican wireless operator was heard sounding out Japanese accounts for a potential Samurai bond transaction via Mitsubishi UFJ-Morgan Stanley and Mizuho in late September. Additional details were not available. A Samurai deal would follow AMX’s $2bn 5-year bond and $750m retap of its 2040s done in September. America Movil is currently also looking at the Euro market, and is scheduled to wrap up fixed income meetings in Frankfurt on Friday.
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Concession Operator Prices MXP ABS
Concesionaria de Autopistas del Sureste has sold a MXP3.5bn ($276m) toll road securitization in Mexico’s domestic bond market. The Chiapas-based operator priced the 26.5-year UDI-denominated bonds at 6.0% or UDIBonos+335bp. “At the end of the day this was a transaction that supports [Mexican] infrastructure,” says one banker on the deal. Demand for the 2038 bonds saw an oversubscription of 1.24x. Banamex and Santander led the transaction, rated AA on a national scale. Sureste is owned by Spain’s Aldesa.
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Holcim Mexico to Issue up to MXP2bn
The Mexican unit of Holcim plans to issue up to MXP2bn ($144m) in the domestic bond market next week, conditions permitting, say bankers on the deal. The bonds, rated AAA on a national scale, will be guaranteed by its Swiss parent. The cement company is considering 3-year floating rate and 10-year fixed rate bonds. Proceeds are to be used to refinance debt. BBVA, Banamex and Santander are handling the transaction, representing a debut for the cement maker in the Mexican market.
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IGS Splits CCD to Afores’ Tastes
Mexico’s IGS has raised MXP1.80bn ($78m) in the certificado de capital de desarrollo (CCD) market, splitting the transaction into 2 separate CCDs to accommodate different investors’ interest in different projects. In what is a first for Mexico’s young CCD asset class, the real estate investor is issuing MXP575m in a 2021 CCD that will be more focused on industrial real estate assets, and MXP513m in a second to be more focused on residential investment. “Late in the process we had an impasse. Some Afores wanted more of one asset than the other, so we decided to make 2 CCDs,” Antonio Ruiz Galindo, CEO of IGS, tells LatinFinance. He explains that a good deal of the investments will still go to both CCDs. The CCD funds will account for part of a larger pool that is made up of 47% private investor cash and about 5% IGS’ own capital, to invest in residential, commercial and industrial real estate projects in Mexico. The industrial investments will be sale-leasebacks on existing properties, while the residential assets will be land to be used for low-income housing supported by government Infonavit and Fovissste. The commercial investment comes from a deal with Homex to develop the commercial spaces within the low-income residential developments. As much of the pipeline is ready, Ruiz says he expects 30% of the fund to be invested within 6-8 months. In a structure typical of CCDs, investors earn a return to repay their invested capital plus a preferred return, in this case 12%, with further proceeds divided 80% for investors and 20% for the manager. IGS expects overall returns of 18% for the industrial investments, 20% for commercial investments and 22% for residential investments, according to the prospectus. ING managed the sale, the first CCD placed since April. Bankers are hopeful that issuance will again pick up, noting the pause was mostly due to discussion with Afores regarding funding CCDs via capital calls, rather than the problems in the public equity markets. Se
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Inbursa Looking at MXP Issue
Mexico’s Banco Inbursa is keeping a close eye on the domestic bond market, to issue up to MXP6bn ($434m). It originally had plans to issue the 5-year floating rate bonds September 28. Banamex, Bank of America Merrill Lynch, and Inbursa are managing the transaction. The Carlos Slim-controlled financial group last visited the domestic market in July, when it priced MXP4.9bn 2014 bonds at TIIE+20bp, through Actinver, Bank of America Merrill Lynch, Inbursa, and Santander.
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Copec Targets all of Colombian SIE
Compania de Petroleos de Chile (Copec) plans to launch a public takeover bid for the 47.21% of Colombian energy investment company Sociedad de Inversiones en Energia (SIE) that it doesn’t own. The fuel distributor is offering COP12,700 per share for the 87.02m shares, meaning a COP1.105trn ($568m) purchase if all holders accept. The per share price matches what Copec paid Corficolombiana for a 7.85% stake last month, and represents a 0.32% premium to Monday’s COP12,660 closing price. The illiquid stock has risen 7.47% since the previous trading session on September 8. Copec says it has secured a $315m standby facility with JPMorgan to use in the transaction. The offer period is from October 10 to October 24. In September, Copec spent COP183bn on Corficolombiana’s stake, in a transaction following the 2010 purchase of Colombian fuel distributor Terpel.
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Acciona Concesiones Eyes State Projects
Mexico’s Acciona Concesiones is looking to participate in several infrastructure projects in the Mexican states of Guerrero, Chiapas and Yucatan, said Sergio Suarez Morales, the company’s director of operations at Spanish infrastructure firm Acciona Concesiones. “We are working with the governments to structure the deals, but everything is still preliminary at this point,” he said. Acciona is looking to invest in long-term social infrastructure such as road and tunnel projects and is actively competing to participate in the office building space. Acciona Concesiones currently manages concessions for the Hospital Regional de Alta Especialidad del Bajio and the Universidad Politecnica in San Luis Potosi, both of which are operated under a public-private partnership scheme. Morales was speaking on the sidelines of the LatinFinance Infrastructure and Sub-Sovereign Finance in Mexico Summit held last week in Cancun.