Wells Fargo has clinched the mandate to bring a diversified payment rights (DPR) issue for Guatemala’s Banco Industrial. The borrower is thought to be aiming for an up to $100m size, with tenors of 7 to 10-years. The bank processed about $6.12bn in DPR flows in 2010, up from $2.96bn in 2015, according to Fitch, which is expected to assign a BBB rating to the debt offering. The issue is the third off an existing program that was established in 2005 and has already seen $258m in offerings. “The ratings on the notes primarily reflect BI’s prominent position within Guatemala’s banking system, the strength of the DPR flows and the relatively high expected monthly debt service cover ratios (approximately 63x),” the agency said.
Category: Structured Finance
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Fovissste Completes RMBS
Mexican government housing agency Fovissste has sold MXP3.9bn ($317m) in domestic inflation-linked bonds backed by mortgage loans. The 2040 UDI-denominated notes pay 4.25%, pricing well inside of 4.70% expectations. Demand topped MXP10bn, according to a banker on the deal. Proceeds will be used to originate mortgages. BBVA Bancomer, BAML, IXE, Banorte managed the deal, rated AAA on a national scale.
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ENA Prints on Volatile Day
Panama’s Empresa Nacional de Autopista (ENA) ventured into volatile markets Thursday to price $395m in dual-tranche bond. Demand was three times over across both tranches, with buyers comprising local banks as well as US insurance companies and pension funds. Tranche A was placed mostly with international accounts, while Tranche B went to domestic investors. “At well over +125bp spread to the sovereign curve, these bonds, especially the 2019 tranche, were very attractively priced,” says one investor. Still spreads came tighter than the original 200bp-250bp that leads were discussing when the deal first emerged. “If you look at other infrastructure deals like the [Brazilian] drillship bond s, they came 100bp wide to Petrobras which is 100bp wide to the sovereign, so to come inside that is a testament to the structure,” says a banker. Both tranches priced at par to yield 5.75% for tranche A’s $170m 2025s and 5.25% for tranche B’s $225m 2019 bonds. ENA is the only LatAm issuer to price this week following a nice flow of US high-grade names. The 144A/RegS notes will be listed on the Panama Stock Exchange, with collateral taking the form of collections from the Corredor Sur toll road and shares of ENA. Tranche A has a make-whole at Treasuries +50bp. Proceed are to be used to refinance $150m of 6.95% amortizing 2025s that helped finance the Corredor Sur tollroad covering 19.5km of Panamanian highway. HSBC and Global Bank led the transaction. The bonds are rated BBB minus/BBB.
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ENA Extends Pricing
Panama’s Empresa Nacional de Autopista (ENA) has extended pricing for its dual-tranche $395m bonds. The corporation wholly owned by the Republic of Panama had set its sights for Wednesday pricing but has opted instead to price and disclose allocations today. The deal comes amid continued uncertainty in the markets as the issuer looks to cover two tranches in the amount of $170m and $225m to refinance $150m of 6.95% amortizing 2025 bonds, a precursor to the sale of the Corredor Sur tollroad for $420m. Tranche A was heard covered by 3x as of late Wednesday while tranche B’s coverage has not been disclosed. ENA launched $170m tranche A at 5.75% with a $225m tranche B at 5.25% Wednesday. ENA’s bonds, rated BBB/BBB minus, were offering investors between high 100s to mid 200s over the Panama sovereign. “The sovereign is trading so tightly. If you look at the Panama 2015s they are being quoted at 2%, so nearly anything with a decent spread over the sovereign is attractive,” says Carl Ross managing director of investments at Oppenheimer & Co. The 144A/RegS deal is being managed by HSBC and Global Bank.
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Fovissste Sets Guidance
Mexican government housing agency Fovissste has set guidance of 4.70% for an up to MXP4.2bn ($345m) equivalent UDI-denominated RMBS, according to a banker on the deal. Pricing, originally set for August 17, is scheduled for today. Proceeds from the 2040 bond will be used to originate mortgages. The issuer last raised MXP3.6bn in June when it sold a UDI-denominated RMBS that generated MXP10bn in demand and priced to yield 4.70% or 339bp over Udibonos. BBVA Bancomer, BAML, IXE, Banorte are bookrunners on this deal. The bonds are rated AAA.
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Gran Colombia Prints Silver-Linked Notes
Gold producer Gran Colombia Gold has placed $80m of 7-year silver-linked notes at par with a 5.0% interest rate. Investors will receive on a pro-rata basis either the $1,000 principal amount per note or the US dollar equivalent to about 66.7 ounces of silver per note, whichever is greater. The company says it is hedged against silver prices as it produces the metal as a by-product at its gold mining operations and it also has developed significant silver resources at its Marmato project in Colombia. Proceeds will be used to develop the Marmato project as well as fund social programs and the relocation of the town of the same name. The deal was led by GMP Securities with RBC Dominion Securities, Fraser Mackenzie, Raymond James and TD Securities also participating. Gran Colombia is a Canada-based gold and silver mining company with operations in Colombia.
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ENA Eyes Next Week Pricing
Empresa Nacional de Autopista (ENA) is wrapping up fixed-income investor meetings today on the West Coast for its two tranche tollroad backed bond offering with pricing expected as soon as Tuesday. The borrower, which is wholly owned by the Republic of Panama, is issuing bonds to help refinance $150m of 6.95% amortizing 2025 bonds that helped finance the Corredor Sur tollroad covering 19.5km of Panamanian highway. To finance the Corredor Sur acquisition, ENA is expected to issue a total of $395m under two senior class notes in the amount of $170m and $225m. HSBC and Global Bank are the leads. The bonds are rated BBB/BBB minus by Fitch & S&P.
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Cemex Concedes Ground on Pricing
Mexican cement company Cemex conceded some ground to domestic investors Tuesday after pricing a MXP2.5bn ($202m) ABS due 2015 at benchmark rate TIIE+200bp, or 100bp over official price talk. “At the end of the day, they raised the pricing to a level where we wanted to participate,” notes a participating investor. Several accounts were seeking at least 200bp over, which was already 50bp inside where the company priced its last ABS issue in 2009. The deal was oversubscribed by just 1x with 80% participation coming from institutional investors and the rest comprising wealth managers. “We raised MXP2.5bn which reflects confidence in the Mexican market,” says a banker on the deal. Proceeds will be used to pre-pay MXP2.2bn in asset-backed bonds due December 2011, which were priced at TIIE+250bp in 2009. Both bond issuances were backed by a trust that held account receivables originated by Cemex Mexico and Cemex Concretos. The new instruments will be backed additionally by Cemex Agegados and Cemex Vivienda. Cemex was last in the international market in July with a $659m retap of its existing 9% 2018s through Citi. Ixe was the sole lead on this transaction. The bonds are rated mxAAA on a national scale by S&P.
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Fovissste Raises Private Overseas RMBS
Mexico’s Fovissste has raised MXP5.48bn ($457m) in UDI-denominated RMBS in a private deal sold to international investors. The 30-year bonds with an average life between 5 and 6 years pay 4.5% and represent the government-backed lender’s first international bond sale. The notes were sold to investors in Europe and Canada, according to a company official, who declined to provide additional details about the buyers. The deal was put together during the last 5 months, the official says, as the lender looks to diversify its sources. Goldman Sachs managed the sale. Fovissste has also filed for MXP4.26bn UDI-denominated sale in Mexico’s local market, indicating an August 17 pricing.
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ICA Units to Issue ABS Bonds
Two subsidiaries of Mexican builder ICA plan to issue up to MXP8.3bn ($692m) in asset backed bonds in the domestic market. The 21-year fixed-rate notes are guaranteed by future payments from contracts the Sarre and Papagos units have with Mexico’s secretary of public safety to build and operate prison facilities. The issue will be divided into MXP and inflation-linked, UDI-denominated portions. Pricing will take place in either August or September, according to bankers on the deal. Proceeds will be used to finance construction of the projects. HSBC, Bancomer and Santander are managing the sale, rated AAA on a national scale.