AMX Raises Tight Euro Funds

In keeping with its promise to establish a full Euro curve since its 2010 debut, America Movil (AMX) made its third visit to the European debt market to raise EUR1bn ($1.25bn). In a tightly-priced sale, the Mexican telecom drew nearly 2.5x demand from investors in the continent where it has been focusing on acquisitions in the past month. Following extensive roadshow meetings on its previous two visits, the A2/A/A minus rated telecom skipped marketing efforts this time around – instead holding a global investor call – a sign of growing investor confidence in AMX. The 2021 priced at 99.977 with a 3.000% coupon to yield 3.003% or MS+113bp, the tight end of MS+115bp (+/- 2bp) guidance, in from MS+120bp price thoughts. The deal was heard offering around 4bp new issue premium against secondary levels seen on the AMX EUR 2022 and EUR 2019 bonds, which were quoted at MS+107bp and MS+110, respectively. “The deal priced incredibly tight to America Movil’s outstanding [Euro] bonds. It would not price at those levels if the book wasn’t there,” says a DCM banker away from the deal. Indeed, within the 6-hour execution, the final book grew to EUR2.4bn, with over 200 accounts heard participating. Fund managers drove demand with 60% participation, insurance companies 25%, pension funds 5%, banks 5% and others 5%. German buyers accounted for 29%, with France taking 27%, UK 15%, Switzerland 10%, Denmark 6%, Asia 5% and the rest allocated to other parts of Europe. AMX was heard pricing through France Telecom (FT) for the first time – an accomplishment after last year pricing 20bp wide to the French telecom. AMX targeted a European transaction as a result of its recent acquisitions in Europe and to establish a competitive curve in Euros, and not specifically for arbitrage opportunity. However, AMX was still able to price at a competitive level to its dollar curve, according to market participants. “This was a very good deal for America Movil,” notes a banker away from the deal who esti