Peru’s Metro builder plans market return

Peru’s Metro builder plans market return

Bonds Debt Capital Markets Project & Infrastructure Finance Peru

Lima Metro Line 2 said it would issue a new bond to finance construction of the second line of the capital city’s subway.

The placement of approximately $540m will close next week. Cash will be used for construction and fund some of the $1.15bn in 2034 bonds placed in June 2015 with a yield of 5.875%.

Goldman Sachs and JP Morgan were tapped for the operation by the Metro consortium, which includes Spain’s ACS Group and FCC, Italy’s Salini Impregilo Ansaldo and Peru’s Cosapi. The group has a 35-year maintenance and operation contract.

Moody’s assigned a Baa1 rating, with a stable outlook to the forthcoming notes.

Line 2, covering 35 kilometers, will cost approximately $5.6bn. It is the first underground line of what will be a five-line Metro system. The original line, inaugurated at the start of the decade, is above ground.

ProInversion, Peru’s investment agency, is expected to announce timelines for Lines 3 and 4 by the end of 2019. Combined investment would be $10.6bn. 

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