The State of Mexico (Edomex) in August issued a much anticipated 4.1 billion peso 20-year local bond, the first securitization of future flows of income from residential property fees from a Mexican state.
Category: Regions
Posted inMagazine
BEST LOCAL CURRENCY FINANCING
Colombia paved the way for LatAm issuers in April with an $800 million 2021 equivalent global TES bond. It braved the market to issue the first global local currency deal from LatAm since 2007, according to Dealogic.
Posted inMagazine
BEST LAW FIRM — LATIN AMERICA/MEXICO
New York-based Cleary Gottlieb Steen & Hamilton is no stranger to megadeals.
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BEST CORPORATE BOND
Southern Copper Corporation (SCC) saw jumbo demand for a $1.5 billion April 2010 issue of new 10 and 30-year bonds, which were tightly priced but still traded up.
Posted inDaily Brief
SABMiller to Swap Bavaria Bonds
Global brewer SABMiller is said to be planning to issue up to COP2.5trn in local bonds to replace existing notes issued by now defunct brewer Bavaria. “Since Bavaria no longer exists because SABMiller bought it, SABMiller will issue new notes in its own name to replace Bavaria’s,” says a banker off the deal, adding that this will not entail the issuance of new debt. He adds that SABMiller intends to replace 4 tranches issued by Bavaria. Of the Bavaria notes, all of which are pegged to IPC, a 2012 piece pays 8.18%, a 2013 piece pays 7.50%, a 2014 piece pays 7.30% and a 2015 pays 6.52%. The new issue will have the same terms, the banker says. SABMiller bought Bavaria in 2005 for $7.8bn. Correval will lead the sale. The deal could occur as soon as January, it is heard.
Posted inDaily Brief
COP Corporate Refinancing Higher in 2011
Around COP5trn ($2.3bn) in corporate Colombian debt will mature in 2011 and need to be refinanced. According to Francisco Chaves, fixed income strategist at Bogota-based shop Corredores Asociados, that number is slightly higher than the 2010 figure. However, the total volume of local bond issuance is expected to drop slightly in 2011. Many Colombian companies have already issued debt in 2009 and 2010 to cover their financing needs, according to another Bogota-based strategist, and may not need to return to the debt market in 2011. According to Chaves, total issuance in 2011 could fall to COP10-12trn, down from COP13.6trn in 2010 and COP13.7trn in 2009. Colombia’s central bank may also begin tightening its rate next year, according to the strategist, which could also play a factor in reduced 2011 issuance. A rate hike may not occur until later in the year, however, and would still remain near historic lows, the strategist adds. The rate currently stands at 3.00%.
Posted inDaily Brief
Credito Inmobilario Downgraded by Moody’s
Moody’s downgraded a Mexican construction loan securitization issued and serviced by Credito Inmobilario to Caa3 from B3 on a global scale, and to Caa3 from Ba3 on the Mexican national scale. The downgrade reflects a severe credit deterioration of the portfolio, significant decline in collections arising from home sales proceeds, a negative excess spread, and high portfolio concentration of new projects.
Posted inDaily Brief
Metepec Downgraded by Moody’s
The Municipality of Metepec is seeing its issuer rating downgraded to Ba1 from A1 by Moody’s. The ratings agency is also downgrading the Mexican municipality’s issuer rating to Ba1 from Baa3, both on a national scale. The outlook is stable. Moody’s says the downgrade reflects gross balances below the median investment grade for Mexican municipalities, a significant decline in consolidated financial performance in 2009, a decline in net working capital and anticipated increases in debt levels to finance planned capital projects.
Posted inDaily Brief
Colombiana RMBS See Demand
Mortgage securitization Titularizadora Colombiana has issued COP94.2bn ($49.0m) in UVR-denominated residential mortgage backed securities, getting 4.3x demand, according to a banker on the deal. The AAA rated 2020 notes pay 1.45%. The notes are backed by mortgages from Bancolombia, BCSC and Davivienda. The company led the issue itself.
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Santander Gives Loan to Guerrero
Mexico’s state of Guerrero has received a 15-year MXP375m enhanced loan from Santander. Guerrero has pledged the flows and rights to 3.17% of its participation revenues, which will be transferred to a trust to pay for debt service. The loan has been rated Baa3/Aa2 by Moody’s because of the underlying credit worthiness of the state and because of the legal and credit enhancements embedded in the loan. These include the strong trust structure, an interest rate cap of 7% for the first 2 years, which protects against an increase in the TIIE, a strong level of reserve funds and cash flows estimated to generate solid debt service coverage ratios, says Moody’s.