CFE Plots Additional Local Bonds

As Mexico’s CFE prepares for a domestic bond issue of up to MXP5bn, the state-owned utility has also announced plans to issue MXP500m under a special bond program for infrastructure spending. The 3.5-year notes will pay a floating interest rate, according to a banker on the deal, and should be priced this month. Ixe is managing the sale. Proceeds from the AAA transaction will used to pre-fund certain expenses for certain kinds of infrastructure projects known as productive infrastructure with deferred expenditure impact, through a fideicomiso jointly set up with Bancomext. Last year, CFE placed MXP1.1bn of the bonds at TIIE plus 75bp, under the MXP3bn program. CFE is also plotting a 10-year fixed- and floating-rate issue of up to MXP5bn through Banamex and Santander, expected this month or next.