Ecuador’s trade balance recorded a deficit of $71m for the first five months of year, compared with a surplus of $897m 12 months ago. According to the Central Bank, exports in the period January to May fell 9% to $4.8bn from $5.3bn in the same period in 2006. Meanwhile, imports rose 11% to $4.9bn, compared with $4.4bn a year ago. Exports of oil and oil products accounted for 53% of the total, or $2.5bn while non-oil products accounted for 47% or $2.3bn.
Category: Regions
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Del Cueto Makes It Five at Banxico
Roberto del Cueto takes up his seat as the fifth board member at Mexico’s Central Bank, Banxico, following his confirmation by the Senate last week. The position has been vacant since the end of last year when Jesus Marcos Yacaman stepped down. Del Cueto was formerly president of the National Banking and Securities Commission and was nominated for the vacant seat by President Felipe Calderón after his first nomination for the post, Carlos Hurtado, was vetoed by the Senate earlier this year.
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Durango Receives $360m Early Tenders for Buyback
Corporación Durango, the Mexican paper and packaging company, has received tenders for $359.7m of around $420m in notes due 2012 as part of its debt buyback exercise, the company said on Friday. The company will pay 103.125% of principal amounts of its Series B senior secured notes tendered by the early payment deadline last week, including a 3.125% early participation payment. The tender offer expires on July 19. Durango will be issuing new debt to fund the refinancing package. Merrill Lynch is managing the transaction.
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S&P Raises Guatemala Outlook
S&P has revised the outlook on its BB/BB+ (foreign-currency/local-currency) long-term ratings of Guatemala to positive from stable. The improvement reflects the country’s “growing prospects for policy continuity after the 2007 national elections, based upon a solidifying consensus on key economic policies”. S&P affirmed its BB long- and B short-term foreign currency sovereign credit ratings on the Republic of Guatemala and its BB+ long- and B short-term local currency sovereign credit ratings. According to S&P GDP growth this year is expected to reach its highest level in more than 10 years – at around 5%.
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Peru Raises Benchmark Rate to 4.75%
Peru’s central bank raised the benchmark interest rate 25bp to 4.75% in its monthly monetary policy committee meeting, which ended the evening of July 5. The hike, the first in 13 months, was apparently a preemptive move to curb rising expectations on inflation and keep it within its target range of 1%-3%. It caught some by surprise, though analysts generally agreed with the decision. “Although we did not expect a hike at this meeting, we were of the view that rate hikes were becoming imperative to protect the inflation target,” according to Goldman Sachs.
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Advent International Buys Javer
Private equity firm Advent International is acquiring the housing business subsidiaries of Corporativo Javer, one of the largest privately held home builders in Mexico in Advent’s largest leveraged buyout in Latin America to date. Advent is the lead sponsor and will assume majority control of Javer. Co-investors include Morgan Stanley Alternative Investments and two European institutions, Deutsche Investitions- und Entwicklungsgesellschaft and the Netherlands’ FMO. The deal, which is not closed, will be funded with a combination of equity and debt, for an undisclosed amount. Merrill Lynch has been tapped to lead the financing.
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Digicel Beefs Up Ranks for Central American Assault
Caribbean mobile operator Digicel has announced three internal promotions to focus the company’s efforts on expanding in Central America and deepening market share in the Caribbean. Donal O’Shaughnessy, a former director in infrastructure, has been named COO for Central America and will lead Digicel’s push into the region and oversee the integration of new acquisitions. Digicel has an operation in El Salvador, a license in Guatemala and is actively pursuing new targets. Kevin White, formerly CEO for Digicel Eastern Caribbean and Trinidad & Tobago, is now chief operations officer for the all of the Caribbean. Niall Dorrian, formerly the COO of Digicel Jamaica, has been appointed CEO of the Trinidad & Tobago. In March, Digicel had 4.7 million customers across 22 markets in the Caribbean, Bermuda and Central America, with investments exceeding $1.5 billion.
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Peru To Prepay 68% Of Paris Club Debt
Peru has managed to secure agreements with 13 of the 15 member countries of the Paris Club to prepay its debt to the group, which totals $2.592bn, and is due 2015. The country will prepay $1.754bn, with payment of another $838 still to be negotiated with France, South Africa and Italy – the first two of which declined to participate in the prepayment agreement and the last of which only agreed to a 50% prepayment. Peru’s vice-minister of finance Juan Miguel Cayo told LatinFinance earlier this year the country would look to pay down $1.8bn in Paris Club debt by the end of 2007.
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Milano Acquires Melody
Controladora Milano, Mexico’s largest discount clothing retailer, has acquired Melody, the leading women’s retailer in Mexico with an undisclosed financing package of debt and equity provided by Latin American private equity firm Advent International and Milano’s other shareholders. Banamex provided the debt financing. The value of the transaction was not disclosed. Combined, the companies have 2006 pro forma revenue of $382 million and operates more than 375 stores in over 125 cities in Mexico. Advent acquired Milano in May 2006 in the first mid-market private equity transaction in Mexico to use cash-flow-based debt. Over the last 12 months, Advent has funded three add-on acquisitions and made four new investments, including most recently Pronto!, a consumer credit company, and La Mansión, an operator of casual dining restaurants in Mexico. In Brazil, two of its portfolio companies have done IPOs recently: Brazilian bank Paraná Banco and duty-free operator Dufry South America, both of which floated on the Bovespa.
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Pemex Seeks Better Terms On $2.5bn Credit Lines
Mexican oil giant Pemex is looking to improve the terms on two $1.25bn revolving credit facilities. One two-tranche facility, with 3- and 5-year maturities, led by Barclays in July 2005, pays around Libor plus 40bp on the longer tenor, according to bankers away from the deal. The second line, a 3-year facility, was launched in May 2006 via Calyon, and pays 27.5bp over Libor. New terms are expected this week. Barclays, Calyon and BBVA are leading.