Colombia’s state owned utility company Empresas Publicas de Medellin (EPM) is bidding for Chile’s Sociedad Austral de Electricidad (SAESA), a subsidiary of US group Public Service Enterprise. The bid is part of EPM’s effort to expand outside Colombia, says a spokeswoman, who declines to provide terms and conditions.
Category: Regions
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Jamaica Mulls Options for Debt Refi
Jamaica, which has EUR200m of debt coming due in February 2009, is considering all options to pay down the notes, including a private placement, Audley Shaw, the country’s finance minister, tells LatinFinance. The notes are trading to yield around 8%. “The first priority is to issue in the capital markets because that’s where we can get the longest maturities,” says Shaw. The bond market for single B issuers has been all but closed for the past several months and if that continues Jamaica may be forced to consider other options. “I want to refinance at 6%-7% – with 8% being the absolute maximum,” says Shaw, who notes he would consider issuing privately, where lower yields could be achieved if the public markets are still demanding a premium. Shaw says he will put out an RFP to banks in the coming months.
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ICA Wins Bid for New Mexico Subway Line
Mexican construction company ICA has won the bid for the construction of a new line of the Mexico City metro, according to the city’s government. Mexico City will invest MXP17.5bn in the new line that will be the largest in Mexico, it says. Mexican builders Alstom Mexicana and CICSA will also participate in the project, the government adds. Construction is expected to start July 3 and conclude in December 2011, the city adds.
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Neogen Opens Mexican Subsidiary
Michigan-based food and animal safety company Neogen has opened a new subsidiary in Mexico. The new entity, named Neogen Latino America will be headquartered in Mexico City and distribute the company’s food and animal safety products throughout Mexico, Neogen says. The new company will also work with the US and Mexico on programs to ensure the safety of food products that move across the border from either country, Neogen adds. Jose Noriega, the former president of Biotecnologia Industrial, will manage the new company and own a minority interest.
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Spain’s Mapfre bags Ecuador’s Seguros Atlas
Spanish insurer Mapfre has purchased 60% of Ecuador’s Atlas Compania de Seguros for EUR3.8m, according to a filing with the Spanish regulator. The transaction awaits regulatory approval. Atlas had sales of EUR14.4m in 2007, a 6.6% growth from the previous year, Mapfre says. The Spanish company expects to converge its operations in Ecuador, where it already operates an office of Mapfre Colombia, into a single entity named Mapfre Atlas, it says.
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Slim Developer ABS Demand Falls Short
Ideal, the infrastructure builder and operator owned by Mexican billionaire Carlos Slim, has priced a MXP7bn 3-tranche securitization of highway concession revenues. The issuer had filed for up to MXP11bn, but scaled back after demand for transaction – still the largest of the year thus far in the local markets according to Dealogic – reached only a little bit over what was placed, according to a banker on it. A MXP1.5bn 2015 floating-rate tranche priced at TIIE plus 28bp, a MXP1.3bn 2036 fixed-rate tranche came at 10.50%, and a MXP4.3bn-equivlant UDI-denominated 2036 tranche priced at 5.69%. The bonds are backed by future flows from the Champa-La Venta, Libramiento de la Ciudad de Toluca, Tijuana-Mexicali and Tepic-Villa Union toll roads. It is the first master trust in the Mexican market structured so additional roads can be added at a later date, according to a banker managing the transaction. Credit Suisse and Inbursa ran the AAA rated deal.
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More Shoes Drop from JPM-Bear
Ex-Bear Stearns head of trading and senior MD Adam Groothuis – a veteran in the underserved CentAm and Caribbean secondary markets – has left JPMorgan, where he was employed for just two days. The departure, apparently to Royal Bank of Scotland, is further evidence of JPMorgan’s failure to bolt Bear’s strong Caribbean franchise onto its existing LatAm presence. John Joseph, a fixed income salesperson, is also heard accepting a JPMorgan job before moving to RBS, while ex-Bear trader John Modell followed the same route to Barclays. Veteran banker AJ Mediratta, former senior managing director and head of international debt capital markets at Bear, meanwhile jumped to the buyside. He is rolling out a new LatAm dedicated private equity vehicle focused on high yield projects for New York-based hedge fund Greylock Capital, targeting a $400m-$500m raise. Meanwhile, ex-senior managing director Carl Ross – Bear’s well known former head of research – has moved to Oppenheimer, the integrated financial services holdings company, where he is a managing director at its Atlanta International subsidiary. Groothuis, Mediratta and Ross have strong client relationships and were instrumental in building Bear’s Caribbean niche.
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Soriana Tests MXP Waters with Jumbo
Mexican retailer Soriana is expected to price up to MXP5.5bn in 2012 floating-rate bonds today. If the maximum is reached, it would represent the largest non-structured Mexican issue of the year to date among non-financial institutions. The issuer has not given any indication of the target spread over the 28-day TIIE. “This will be a good experiment,” says a DCM banker away from the deal. “With the volatility this year, we haven’t seen many big deals.” Inbursa, JPMorgan and Banamex are managing the transaction. The AA/Aa2 issue is the first from a MXP15bn shelf to help finance the December acquisition of rival Grupo Gigante for $1.35bn plus inventories and rent. Soriana is expected to place the remainder of the shelf this year, according to Moody’s, to take out about MXP18bn in a bridge.
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Ecuador Risk Revives
Ecuador’s president Correa has ramped up the rhetoric about annulling debt that is deemed illegitimate. “The risk to bondholders is that by making these statements, Correa may put himself in a position from which it will be difficult to backtrack,” says Credit Suisse. Ecuador is apparently questioning the legitimacy of bonds issued in the 2000 restructuring. “Noise surrounding the illegitimacy of the debt will likely increase when the Debt Committee issues its final report (in about 45 days, according to Correa) and ahead of the referendum to approve the new Constitution,” adds CS. Once the committee issues its final report, the government is expected to take punitive actions against all those who were involved in the contracting of illegitimate debt, as well as take civil and administrative action to annul any debt that is deemed illegitimate. “We do not look for Ecuador to unilaterally default on the debt, but headline risk increases as the referendum on the new Constitution approaches and populist rhetoric become more frequent,” says Merrill Lynch.
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Cemex Venezuela Sells Offshore Assets
Cemex Venezuela has sold assets it had outside the Andean nation for $547m. The company says it got rid of shares in several companies in Panama, Guadalupe, Trinidad & Tobago and the Dominican Republic that did not have links to its operations in Venezuela, where it is victim of the nationalization process.