Cement Giant Gains Consent

Cemex has received consent from a majority of its main bank lenders to amend or waive leverage covenants on some $12.2bn in syndicated loans and well over $3bn in bilateral facilities, say people involved in the discussions. This gives the troubled Mexican cement maker breathing room to further adjust terms on maturing debt and sell assets to raise cash without having to scramble to avoid tripping covenants. The company is also in the process of extending maturities on a handful of critical facilities, many of them bilateral, to work through a more orderly refashioning of its balance sheet in the coming year. The facilities to be amended are held at three different borrowing entities, says a banker on the deal. The holding company has a $700m 4-year revolver signed in June 2005 at Libor plus 45bp and a $1.2bn 5-year revolver done in the same month at Libor plus 50bp. The holdco also has a $500m bilat with BBVA inked in June. Cemex Espana had a $6bn Rinker acquisition facility with tenors of 3 and 5-years signed December 2006 at rates of 32.5bp-45.0bp over Libor; a $2.3bn 2, 3 and 5-year revolver signed September 2004 and amended a year later at 35.0bp to 42.5bp over Libor; and a €400m 5-year facility with a yen portion signed in March 2004 at Euribor plus 35.0bp and 57.5bp. And New Sunward, a separate holdco, has a $700m 2 and 4-year facility signed June 2005 at rates of 35bp and 42.5bp over Libor; and a $1.05bn 3-year facility. Credit date pricing for the above mentioned facilities comes from Dealogic. The banks leading the talks with Cemex on amendments and extensions are BBVA, Citi, HSBC, RBS and Santander.