Argentina Builds Up To Infrastructure Securitization

Argentina is awaiting the first infrastructure securitization to come to market later this month, due to be launched by gas companies Transportadora de Gas del Sur (TGS) and Transportadora de Gas del Norte (TGN). The securitization, backed by gas receivables, will total $600 million and will replace original financing from international and domestic oil companies with that of institutional investors. It is being structured by Nación Fideicomisos. Early next year, another infrastructure securitization is expected totaling $75 million – to finance the paving of rural roads. Argentina’s private pension funds (AFJPs) are expected to take a strong interest in investing in the new instruments as they represents a way of investing in the real economy. To date, only a small fraction – around 3% – of the $25 billion the AFJPs manage has been invested in structured finance.