Chihuahua Starts Jumbo Road Securitization

The Mexican state of Chihuahua has priced a MXP12bn ($915m) securitization of toll road revenues, representing the first and largest portion of a three-tranche deal. The 25-year UDI-denominated tranche priced at 5.95%, or UDIBonos+236bp, according to people familiar with the terms. Raising funds to refinance liabilities and finance new projects, the state received some MXP12bn demand driven mostly by institutional investors keen on duration. Inbursa and Value managed the tranche, rated AA/AA on a national scale. The deal comes under a MXP15bn program divided into three parts. The state plans to raise an additional MXP3bn using a fixed-rate 15-year tranche with an 8.9-year average life and a 15-year floating-rate tranche with a 9-year average life. Pricing for the remainder is tentatively scheduled for September 4. The peso-denominated tranches feature a guarantee from development bank Banobras for up to 15% of the total size per tranche. Inbursa, Value Casa de Bolsa, BBVA Bancomer and HSBC are bookrunners for the peso-denominated, AAA-rated portions. Cofinza is structuring agent. The deal is the largest in Mexico’s domestic market since Comision Federal de Electricidad’s (CFE) MXP12bn floating rate transaction in June. Looking ahead in the toll road securitization space, Mexico’s Concesionario de la Autopista Monterrey-Saltillo (CAMS) is planning to sell up to MXP1bn ($79m) in UDI-denominated notes via Value.