Sempra Meets Buyside

Sempra Mexico has commenced a five-day roadshow ahead of what is expected to be its first issuance in Mexico’s domestic market, as well as the first by a non-government entity in the energy sector. The Mexican unit of US-based Sempra Energy began Monday meeting investors ahead of the planned MXP5.2bn ($412m) transaction. The issuer is able to choose among a 2018 tranche paying a spread to the TIIE and a 2023 fixed-rate tranche. CFE and Pemex are likely pricing reference points, with the transaction expected to offer a pickup to the two government-owned entities. Pricing is expected February 6. Deutsche Bank, Credit Suisse and Santander are managing the transaction, rated AAA/Aaa on a national scale. In October, the Mexican unit of US-based Sempra Energy won a 25-year contract to build and operate a pair of gas pipelines in the state of Sonora, which should require a $1bn investment including proceeds from the bond sale, according to ratings agency reports. Sempra operates five gas pipelines and a regasification terminal in Mexico, and derives about 60% of its revenues from CFE contracts.