Category: M&A

Mexico’s largest fixed-line telephone operator, Teléfonos de México (Telmex) is continuing with its acquisition spree of cable TV operators in the region. The company announced on Tuesday that it is in talks to acquire Peruvian cable TV operator Boga Comunicaciones. The Mexican giant bought three cable TV companies in Colombia last year and added another Brazilian operator to its portfolio. Telmex said it is planning capital investments of $1.1 billion in Mexico and $800 million in its operations abroad this year.

Brazilian securities regulator (CVM) has announced that Luxembourg-based Arcelor Mittal must raise its offer to minority shareholders in Brazil in order to close its merger. Last year, Netherlands-based Mittal Steel bought steel company Arcelor Brasil as part of its takeover of rival Luxembourg-based steelmaker Arcelor in a deal worth $37.3 billion. Following the merger, the CVM ruled that Mittal had to offer to buy out minority shareholders of the Brazilian unit, and rejected an appeal by Mittal. The European company offered 33.3 reais per share, well below the 51 reais per share demanded by shareholders. The regulator’s latest ruling suggests a price of 47.9 reais per share and gives a deadline of February 27 for the offer.

Luxembourg-based Tenaris, controlled by Argentina’s Techint, has made another US acquisition to consolidate its expansion into the North American market. The steel tube producer has agreed to pay $2.16 billion for Hydril a Houston-based firm that specializes in making tube connectors and pressure control products for the oil and gas industry. The company said it would finance the purchase using cash and $1.5 billion of debt. Last year, Tenaris paid $2.4 billion for steel tube producer Maverick Tube to enter the North American market. Sector analysts see the latest acquisition as a complement to the purchase last year and expect to see significant synergies once the two companies are integrated. Citigroup Global Markets advised Tenaris in the Hydril deal, while Credit Suisse and USBX Advisory Services guided Hydril.

Confirming recent speculation, Mexico’s América Móvil has pulled out of a deal to buy a 28.5% stake in Venezuela’s CANTV from Verizon of the US. The acquisition had yet to receive regulatory approval. Last year, as part of a wider deal, the mobile phone operator owned by Carlos Slim agreed to buy the Venezuelan assets for $676.6 million. However, plans announced by President Hugo Chávez to nationalize Venezuela’s telecoms industry sent CANTV shares plummeting at the beginning of the year. Government statements made since have done little to reassure investors.

Argentine telecom operator GC Impsat, which is being acquired by Global Crossing, priced $225 million in 9.875% bonds (B3/B-). The offering, originally expected to be $200 million in the 10% range was priced at par. Credit Suisse was bookrunner, with Deutsche bank as joint-lead. Since the funds are destined for an acquisition, expected to close as late as April, they will be put into escrow and there is a put penalty in case the deal doesn’t close.

Argentine satellite company GC Impsat will price today $225 million in 9.875% 10-year bonds rated B3/B-, to help pay for its acquisition by Global Crossing. The offering launched Wednesday, upsized from $200 million, and the price was trimmed from an initial 10%, according to a banker close to the deal. Credit Suisse is bookrunner, with Deutsche Bank as joint-lead. It was on the road last week.

Guatemala’s banking sector continues to consolidate with the acquisition by Banco Reformador (Bancor), the country’s fifth-largest bank, of Banco SCI. Bancor has $800 million in assets; Banco SCI has $175 million. This is the third merger in the sector since the beginning of the year. First was the acquisition by G&T Continental of Banex-Figsa, then came Banco Agromercantil, which bought Banco Corporativo last week. Guatemala’s banking sector has suffered recently from two bank failures – those of Bancafe and Banco de Comercio, in October and January.

QBE the Americas, a subsidiary of Australian insurer QBE Insurance Group, has entered the Mexican market with the acquisition of 100% of Cumbre Seguros, a specialized Mexican insurer in Mexico. The purchase is part of a strategy to enter Latin America’s five largest markets: Argentina, Brazil, Colombia, Mexico and Chile, said the Australian firm. QBE expects the transaction, which is subject to regulatory approval, to close during the second quarter of the year. Cumbre Seguros writes commercial property and casualty insurance products for mid- and small-sized businesses and had gross premiums of $58 million last year, according to QBE.

Colombia’s financial regulator has approved the acquisition by local bank Davivienda of Bancafe, which the former bought from the government at auction for $927 million last October. The acquisition will be funded by around $115 million from the issue of new shares to existing shareholders; a $75 million capital injection from the IFC; $165 million of subordinated debt, of which $65 million will be taken by the IFC; $250 million syndicated credit, as well as the bank’s own resources.