STRUCTURED FINANCE: Afores Harvest AGSA Clones
Jul 1, 2009
A successful 1.65 billion peso teak tree securitization by Mexican grower AGSA in July 2008 has sprouted a host of local ABS imitators. As of mid-June, deals from the homebuilding, restaurants and private equity (PE) sectors, were en route.
The innovations of AGSA’s original AAA structure, custom designed to fit Afores’ needs, lie in the way proceeds are channeled through an issuer’s business and how investors are remunerated. A portion of the funds is used to purchase zero-coupon government Mbonos that guarantee principal, while the remainder goes toward capital investments. Instead of receiving a traditional coupon, holders receive a portion of the revenues resulting from the investment, in addition to the principal at maturity.
As of mid-June, restaurant holding company Grupo House and homebuilder Geo were readying AGSA-like deals. Geo’s up to 3.0 billion peso 2024 transaction, rated AAA, is expected to be the first to market, pricing as early as late June. Banorte and Santander are leading. HSBC, meanwhile,...
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