Mexico returned to the samurai bond market late on Thursday to price a JPY283 billion ($1.77 billion) four-part deal, securing funds ahead of a potential rise in Japanese interest rates.
The government printed JPY177.3 billion in 3.5-year bonds and JPY87.2 billion in five-year notes paying fixed coupons of 3.16% and 3.61% respectively, it said Friday in a press release.
The sovereign also issued JPY1.2 billion in 4.46% 10-year notes and JPY17.1 billion in 5.49% 20-year notes in an offering that drew 52 institutional investors, the release said.
Mexico, which last issued debt in the Samurai market two years ago, moved to raise funds ahead of a potential hike in borrowing costs by the Japanese central bank next month, according to a source involved in the deal.
It priced the 2030 and 2031 notes at par to yield spreads of 115 and 140 basis points over the Tokyo Overnight Average Rate respectively, after opening the bidding on Monday at around 100 and 130 bps, the source said.
It sold the 2036 and 2046 notes at par to yield spreads of 170 and 210 bps, respectively, after opening the initial price talk at around 170 and 200 bps, the person added.
The Mexican government said in the release it will use the proceeds to fund projects that are aligned with its sustainable development goals, including investments in education, agriculture, renewable energy, climate action and biodiversity.
Daiwa Capital Markets, MUFG, Mizuho, Nomura and SMBC Nikko were bookrunners on the deal, which adds to the $21 billion the sovereign has raised in the cross-border market in 2026.