Canadian Imperial Bank of Commerce (CIBC) announced that it is to take control of FirstCaribbean International Bank by doubling its stake to 87.4%. It plans to buy an extra 43.7% from Barclays PLC for about $1.08 billion. BCM and Barclays created FirstCaribbean, now the largest bank in the English-speaking Caribbean region, in 2002 when they merged their Caribbean operations. FirstCaribbean has assets of $9.6 billion and a market value of $3.3 billion.
Category: Regions
Posted inDaily Brief
Local Bidders Withdraw
Two local bidders for Colombia’s state-owned fixed-line company, Colombia Telecom, have said they are withdrawing from the process. Empresa de Telecomunicaciones de Bogotá and Empresas Públicas de Medellín (EPM), the largest public services provider in Colombia, said they were unable to make a “serious and reasonable offer” for Colombia Telecom in the face of competition from foreign firms such as Mexico’s Telmex, Telefónica de España and Venezuela’s CANTV. The only local bidder left in the running is cable provider Cablecentro.
Posted inDaily Brief
Moody’s Revises Colombia Outlook
Ratings agency Moody’s Investors Service has revised its outlook on the foreign currency credit rating of Colombia from negative to stable. Moody’s currently rates the country’s foreign currency bonds Ba2. Last month, ratings agency Standard & Poor’s raised Colombia’s long-term foreign and local currency credit rating outlook, from stable to positive. The improved outlooks are a product of Colombia’s better growth prospects brought about by greater domestic security and renewed confidence in private investment.
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Ecuador Declares State of Emergency
Ecuador has declared a state of emergency in three of its provinces following a widespread strike by contract oil workers. The north-eastern oil-producing provinces of Napo, Sucumbios and Orellana are now under the jurisdiction of the military. Last month, protestors shut down two oil pipelines in the region causing the temporary disruption of oil exports. And in August last year, locals shut down production when they demanded more economic investment from central government and foreign investors operating in the zone. State-owned Petroecuador saw foreign earnings hit by the general strike.
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HSBC To Enter Peru
UK and Hong Kong-based financial giant HSBC has made a formal application to Peru’s banking superintendency to set up operations in that country. It is thought the bank may be up and running by August this year. Peru currently has 12 banks and the government is open to increasing competition. HSBC had expressed an interest last year in entering Peru’s financial market as part of a move to expand its overall presence in the region. HSBC already operates in Argentina, Brazil and Mexico. Last week it agreed to buy the assets of Lloyds TSB in Paraguay for $15 million.
Posted inDaily Brief
Bidders Line Up For Colombia Telecom
Six companies have lined up to bid for Colombia’s state-owned telecoms provider, Colombia Telecom, in what will be one of the Uribe government’s largest privatizations. The bidders include Telmex, owned by Mexican entrepreneur Carlos Slim, which tried but failed to buy the Colombia fixed-line provider last year for $350 million. The deal fell through after the country’s Controller General advised against it. Other interested parties include Spain’s Telefónica and Venezuelan firm CANTV.
Posted inDaily Brief
Cemex To Sell Indonesia Stake
The world’s third-largest cement producer, Mexican Cemex, is to sell its 25.5% stake in Indonesia’s largest cement-industry player, Semen Gresik. Cemex’s stake has been valued at around $395 million. The Mexican firm has said it has not yet found a buyer; meanwhile the Indonesian government has confirmed it will not be buying the stake.
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Bolivia To Take Control
The government of Evo Morales is seeking to take control of 10 companies partially privatized over the past decade. The companies include national carrier Lloyd Aereo Bolivia (LAB), Entel, Petrolero Chaco and Petrolero Andina. The government has said it will initially look to buy shares in these companies but if necessary pursue other means to wrest control away from foreign investors. Morales was elected on a pledge of ensuring greater control by Bolivia of its assets, in particular its natural resources.
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Colombia Buys Back $600 Million Bonds
Colombia bought back $601 million of foreign-currency bonds yesterday, Monday, in a move to reduce foreign currency debt obligations. Surging commodity-led export revenues were used to fund the repurchase of the dollar- and euro-denominated debt instruments maturing between 2006 and 2011. The sovereign also sold $306 million worth of peso-denominated bonds to help fund the buyback. The local currency bonds — Global TES — mature in 2015 and are part of an issue first launched last February. Colombia cancelled a planned sale of new paper maturing in 2021. The deal was managed by JP Morgan Chase & Co and Morgan Stanley. Last year, Colombia’s foreign currency-denominated debt as a share of overall debt fell to 33% from 44% in 2004.
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Peru Seeks Strategic Investor
After taking control last week of one of the country’s major steel-producer, SiderPeru, the government is to push ahead with its privatization. Last Friday, the Peruvian state investment agency, ProInversión, paid $53 million for 56.04% of the company, based in northern Peru, following the failure of private owners Sider Corp to meet investment obligations. In 1996, Siderperu was bought by Sider Corp, a group including Acerco and Wiese Inversiones Financieras, part of Banco Wiese Sudameris. The Group has only paid $110.7 million of the $186.2 million originally agreed with the government, while its outstanding debt, including payments, have risen to $237.3 million.