The IDB says it has approved a $200m loan to Argentina to support science and technological innovation in strategic economic sectors such as agribusiness, energy, health and environment. The credit line was approved for a 25-year term, with a grace period of 5 years, and an interest rate based on Libor.
Category: Loans
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BCP Eyes Further Funding
Banco de Credito del Peru (BCP) has finished its issuance for this year but will likely return for more in 2011. “We’re always looking for funding,” Gonzalo Alvarez-Calderon, BCP’s head of international business, tells LatinFinance. He adds that BCP has been seeing 20% annual loan growth, which it will continue to support by borrowing. The bank has not decided how much it will look to raise next year. It recently closed a $350m 3-year syndicated loan priced at 175bp over Libor, which it upsized from an original $300m. The deal via Citi and Standard Chartered was syndicated to 16 banks, including Chang Hwa, Bank of Taiwan and Malayan Banking Berhad. Alvarez-Calderon says the leads were incentivized to bring in Asian institutions. Total demand was $387m. The deal is for general corporate purposes, in particular to fund loan growth. The facility follows an $800m September issue of 2020 bonds. The BBB/Baa2 deal priced at 99.763 with a 5.375% coupon to yield 5.406%, or UST plus 265bp, the tight end of 275bp area guidance. Bank of America Merrill Lynch and Deutsche Bank managed the sale, the first bond from BCP since a $250m hybrid in November 2009.
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Honduras Gets Fiscal Reform Loan
Honduras will receive $45.8m from the IDB to support the country’s fiscal reforms, and improve its tax system and state utility revenues. The financing will consist of a $32.06m, 30-year loan with a 5.50-year grace period and a fixed income rate, and a $13.74m, 40-year loan with a 5.50-year grace period and an annual interest rate of 0.25%.The financing will be disbursed in 2 tranches of $22.9m. The first will come after the approval of a tax reform designed to increase collection rates, efficiency and equity in the tax system. The second tranche will come after the approval of other tax regulations. The country will also enact a law against tax evasion. In addition, the government will take steps to raise the revenues of the state-owned electricity company, Enee, and the telecommunications company, Hondutel.
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Mexico Gets $1.35bn in Loans
The World Bank has given a $1.25bn 17-year loan to support Mexico’s Oportunidades Program, to help poor families, and a $100m 12-year loan to the Mexico Water Utilities Efficiency Investment Project. The loan for Oportunidades is expected to help benefit 5.8m of the country’s poorest families, it says. The project will cost $9.90bn, $1.25bn of which will be financed by the World Bank and $8.65bn by the government counterparty. The first World Bank loan for Oportunidades was approved in April 2009. The $100m loan for the Mexico Water Utilities Efficiency Improvement Project is aimed at improving the efficiency of utilities, through technical assistance and financing. The project will cost $200m, $100m of which will be financed by the World Bank and $100m by the government counterparty. The project is expected to end on December 2014.
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Itau Chile Loan Builds
Banco Itau Chile has garnered several commitments on a $150m 2-year term loan facility it is syndicating, according to bankers with knowledge of the transaction. HSBC, RBS, Wells Fargo, Commerzbank, Citi, Bank of America, Credit Agricole and BNP Paribas are joint leads on the transaction. Bank meetings were last Wednesday. Commitments are expected November 23 and the deal will close early December. Proceeds will be used to lend to Chilean corporates. The spread offered is of Libor plus 90bp.
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Quiroz Galvao Heard Oversubscribed
Quiroz Galvao is finalizing allocations for a $575m 7-year syndicated loan for Alpha Star, with the deal substantially oversubscribed, according to a banker leading it. Final allocations are expected within the next few days. Santander and Citi are leading the transaction, with proceeds being used to build oil platforms. The spread is 250bp over Libor for the construction period and 225bp over for the post-construction period, say bankers with knowledge of the transaction.
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Alfa Offers Spread on Acquisition Loan
Mexican conglomerate Alfa is heard to be offering a spread of 300bp over Libor on a leveraged grid for its syndicated loan to back the $600m purchase of Eastman Chemical assets in the US. A $600m 3-year bullet facility is expected to be syndicated. Invites have been sent out but meetings have not been fixed, according to people close to the transaction. Meetings are expected first in Mexico City, followed by New York. Credit Suisse and HSBC are the leads. Alfa’s purchase of Eastman’s polyethylene terephthalate resins business and related assets and technology of its Performance Polymers segment was done by Alfa unit DAK Americas. BAML advised Eastman while HSBC worked on the buyside. Fitch downgraded Alfa subsidiary Grupo Petrotemex to BB (stable) from BB+, including notes issued by DAK, amid fears over leverage incurred in the purchase. On a pro-forma basis, Fitch estimates that Petrotemex’s total debt-to-Ebitda, including 12 months of Eastman assets operations, could reach 3.3x in 2010 before gradually decreasing. This compares negatively with a total debt-to-Ebitda ratio of 2.2x for the 12 months to June 30, and falls outside Fitch’s prior leverage estimate of 2.0x-2.5x. Nonetheless, Fitch notes that the investment is strategic and positive for Petrotemex, and should strengthen its business as it gains PET market share in North America.
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Nicaragua Project Closes $160m Financing
RAM Power, a US renewable energy company, has closed $160m in debt financing, via IFC, which will go towards the second phase expansion of its San Jacinto-Tizate geothermal power project in Nicaragua. The borrower would not disclose the spread over Libor on the floating rate loan, but the company expects to swap it to a fixed-rate loan for 7%-8%. Initial drawdown is expected to occur in December 2010, with final maturity in 13 years and an 8.5-year average life for the senior debt. The $140m in senior construction and term loans and $20m in subordinated debt are available for general corporate purposes, in order to complete the second phase of this project. Combined with phase 1, it will provide 72MW of power to Nicaragua, to be completed by the end of 2011, according to Hezy Ram, CEO of Ram Power. IFC, IDB, CABEI, DEG, FMO, OeEB and Proparco were lenders on the transaction. Ram says that IFC all of the subordinated debt along with $30m in senior debt. IDB provided $30m in senior debt, with Proparco providing $20m, DEG $19m, FMO $19m, OeEB $15m and Cabei $7.6m. “We had well over $200m in demand for $140m of senior debt,” says Ram.
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Odebrecht Bringing Drillship Jumbo
Odebrecht is expected to price its $1.5bn 10-year drillship bond this week, and potentially as soon as Wednesday, according to a banker on the deal. Pricing is expected to come in at the tight end of mid-to-high 6% guidance. Although investors are requesting more information on the 8.1-year, BBB/Baa3 amortizing deal through the Odebrecht Drilling Norbe VIII/IX unit, the book is still growing, according to bankers on it. Santander, HSBC, Deutsche and Banco do Brasil are managing the sale. The notes are backed by intercompany loans granted to each drillship, according to Fitch.
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Peru to Get IDB Loan
The IDB has approved a $110m loan to Peru to reduce poverty by strengthening its principal social protection and labor programs. The loan comes from IDB’s ordinary capital and has an amortization period of 20 years with a 5-year grace period and an interest rate based on Libor.