Oaxaca is looking to pay TIIE+125bp on a new 15-year floating rate bond, as it seeks to refinance MXP1.45bn in bank debt. The Mexican state plans to raise MXP1.95bn ($145m) through the sale. Proceeds are for general budget purposes. Interacciones is leading the transaction, rated AAA on a local scale.
Category: Regions
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Sinopec Clinches Good Price for Galp Brazil Stake
The China National Petrochemical Corp’s is seen obtaining an attractive price after purchasing a 30% stake in the Brazilian operations of Portugal’s Gap for $3.54bn, marking yet another step into Latin America by the company better-known as Sinopec. “Sinopec got a good deal, and it seems less willing to overpay for barrels as it did in the past,” said Thomas Adolff, European oil industry analyst at Credit Suisse. He notes that Galp was also selling its assets under duress, which no doubt helped strengthen Sinopec’s position. Based on Credit Suisse estimates, the enterprise value of the deal is $4.30 per barrel, which is much lower than Sinopec’s acquisition of a 40% stake in Repsol’s Brazilian assets in October 2010 for $5.30 a barrel. The shop also reckons the transaction was valued below Petrobras’ transfer of oil rights which, adjusted for WACC and a special participation tax, stood at $5.80 a barrel. As priced, the deal values the overall Brazilian unit at $12.5bn. The Portuguese company has been seeking to raise as much as EUR2bn ($2.75bn) from the sale of assets and has considered unloading as much as 40% of its business in Brazil. Bank of America Merrill Lynch, UBS, JP Morgan and Caixa advised the Portuguese company. Galp holds stakes in 21 oil projects in seven different Brazilian basins, including the Santos pre-salt basin home to the Lula field, the second largest oil discovery in the Americas.
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Saba Names New CFO
Mexican pharmacy chain and distributor Grupo Saba has named Jorge Sanchez as CFO, who will replace Pedro Alejandro Sadurni.
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Davivienda FO Demand Tops $370m
Colombia’s Banco Davivienda has seen orders reach COP716bn ($373m) in its equity follow-on, reaching close to the upper end of the COP480bn-COP800bn it is authorized to raise during the sale period ending November 10. Details on final allocations and size will be released by the end of the month. Davivienda launched the FO October 20, offering 20m-40m shares at COP20,000 each. The bank is raising funds to grow and keep up with the expansion of other Colombian FIGs. It has its eyes on operations in other countries including Peru, and an eventual ADR listing and 144a bond offering. Corredores Associados is managing.
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Ecuador Gets New Central Bank Head
Ecuador’s President Rafael Correa has named Pedro Delgado as the new central bank president. The change comes as part of cabinet shuffle, in which Jeannette Sanchez becomes minister of economic policy coordination. Finance Minister Patricio Rivera continues in his position.
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Lindley on the Road
Peru’s Corporacion Lindley, a non-alcoholic beverages company, will kick off today investor meetings in the US, Europe and LatAm. The BB+/BBB minus borrower will see accounts today in Lima. Next week it will be in Santiago and London on Monday, in New York on Tuesday, and in Boston on Wednesday before wrapping up in Los Angeles Thursday. Citi 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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Peru Holds Rates
Peru’s central bank has decided to again hold the benchmark rates at 4.25%, in line with market expectations. Above-target inflation was seen as the main reason for holding rates this month.
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Vitro Debt Restructuring Extended
A court appointed arbitrator has asked for an extension in Vitro’s $3.6bn debt restructuring, marking the latest salvo in a controversial debt overhaul for the trouble Mexican glass-maker. Javier Navarro, a mediator charged with tallying bond-holder support for the borrower’s restructuring proposal, asked the court on Thursday for a 45-day extension in a process originally scheduled to end on Nov 14. “This gives me more time so I don’t have to declare company bankruptcy,” but it is not intended to provide creditors with a longer period in which to act, Navarro tells LatinFinance. This comes as some creditors cry foul after a Mexican judge allowed Vitro to include $1.9bn in intercompany debt as part of the bondholder tally. This has essentially allowed the company to say that 51% of holders have agreed to the terms, but left other creditors arguing otherwise. Vitro’s offer includes $814.7m in new 2019 bonds, a fee of up to $32.7m and mandatory convertible debt of $95.8m. When all is said and done, JPMorgan reckons that creditors who accept the deal may recover between 48 and 60 cents on the dollar, depending on the level of debt-holder support. “Bondholders are being trampled on,” says a Vitro investor who declines to be named. A Vitro official would only say that under current conditions negotiations will likely continue until early 2012.
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Mitsubishi Upends Codelco’s Anglo Sur Ambitions
Anglo American has agreed to sell 24.5% of the Anglo Sur copper mining complex in Chile to Mitsubishi in a surprise $5.39bn deal. The move lands a blow to Chilean state copper company Codelco’s ambitions to secure a 49% stake in the venture. Mitsubishi swooped in on the chance to pay $5.39bn for only 24.5%, or a multiple of 18.1x 2010 Ebitda. Mitsubishi’s implied enterprise valuation for the entire project was $22.9bn. Codelco can now only buy a smaller, 24.5% piece. “The valuation is compelling,” an Anglo American spokesman says when asked to comment on the sale, which comes just ahead of the government’s option exercise date. Goldman Sachs and UBS advised Anglo American on the deal, according to company officials. Codelco sought to exercise an option in January 2012 to buy 49% of Anglo Sur paying an estimated $6bn, or 10.2x 2010 Ebitda. The option made this possible as long as Anglo American held 100% of the venture at the time, Anglo American officials said. Codelco officials could not be reached for comment, but in a statement the company said the transaction “doesn’t affect Codelco’s rights over 49% of the shares in Anglo Sur” and that it would “pursue all necessary actions” to defend its rights. Mitsubishi has been a long-time investor in Chilean copper and currently holds a 2.5% stake in Chile’s Escondida open pit mine.
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Colpatria Sells COP80bn Bonds
Colombian financial conglomerate Colpatria has sold COP80bn (42m) of subordinated bonds in the local market. The 2021 bonds were priced at IPC+5.25% after generating COP112.9bn in demand. Alianza Valores managed the transaction, rated AA on a national scale. Banco Popular is expected to raise COP250bn in the local market next week.