Mexico Tracks Market for Potential Samurai

Mexico’s fixed-income investor meetings in Japan at the end of August were successful, and may result in a Samurai bond transaction as soon as market conditions permit, according to a person familiar with the sovereign’s plans. A transaction could occur before year-end but may be issued sooner depending on market conditions. “We cannot deny the possibility of a transaction, but we are not sure if it will take place in October, November or December,” the person familiar added. Should Mexico pursue a Samurai it would be looking at JPY30-50bn ($393m-$655m) size with a 2, 3, or 5 year tenor, the person familiar added. Alejandro Diaz de Leon, the country’s public credit head, previously told LatinFinance last month that Mexico intended to build a long-term investor base in Japan and become a frequent Samurai issuer. Initially, Mexico was looking at a 5-year tenor at around $500m equivalent for its potential Samurai. Bank of Tokyo Mitsubishi, Citigroup and Nomura led the investor meetings. Mexico last issued JPY150bn ($1.8bn) of 10-year bond at a 1.51% yield in October.