MEXICO: FEMSA announces Mexican bond issuance

By just-drinks.com editorial team | 6 December 2007

Fomento Economico Mexicano (FEMSA) has announced the placement of two tranches of Mexican Peso-denominated bonds in the Mexican capital markets.

The company said yesterday (5 December) that it has successfully issued MXN3.5bn (US$323m) in six-year 'certificados bursatiles' at a rate of 28-day interest rate minus 0.05%, and MXN2.5bn in ten-year UDI bonds at a rate of Udibono plus 0.56%, which has been swapped under favourable conditions.

The tranches were 4.5 and 2 times oversubscribed, respectively, in spite of "challenging market conditions", FEMSA said.

The company added that this issuance has received local currency credit ratings of AAA from both Standard & Poor's and Fitch Ratings, and is the second largest placement by a Mexican corporate this year.

The proceeds from this issuance will be used entirely to refinance existing loans to improve its cost of debt and "significantly extend its maturity profile," FEMSA added.

FEMSA is the leading beverage company in Latin America, which controls Coca-Cola FEMSA, Mexican-based FEMSA Cerveza, which imports beer to the US, and the Mexican convenience store chain Oxxo.

Sectors: Beer & cider, Soft drinks, Water

Companies: FEMSA