July 01 2009
STRUCTURED FINANCE: Afores Harvest AGSA Clones
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 AGSAs original AAA structure, custom designed to fit Afores needs, lie in the way proceeds are channeled through an issuers 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 ...
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