CFE Local Tap Takes Time

CFE’s dual-tranche deal for up to MXP9bn will price on January 19, according to a banker on the deal, and is expected to be the first deal of the year in the Mexican local market. The deal had initially been expected on January 11. It is a retap of its 4-year floating and 10-year fixed rate bonds issued in December of last year. Pricing has not yet been determined, adds the banker. One investor expects pricing to be in line with the original bond issue. “The first deal was only last month, since which market conditions have remained the same, so I would expect neither a price tightening or widening,” he says. BBVA Bancomer, Banamex and ING are joint leads on the sale for the federal electricity company. The bonds are rated AAA on a national scale. Proceeds will go toward working capital and to refinance existing debt. The original deal priced December 2. The 10-year tranche was for MXP9.0bn, after total orders reached MXP14.6bn. The bonds priced to yield 7.96%, or Mbonos plus 120bp, in line with guidance, according to bankers on that sale. The 4-year was for MXP5.0bn, on MXP8.4bn in demand. That tranche priced at 26bp over TIIE, tight to guidance of 30bp.