February 1, 2009
The transaction also creates a new role for infrastructure development bank Banobras. Parts of the deal may be replicated, particularly the guarantee, State of Mexicos finance secretary Luis Videgaray tells LatinFinance. The amortizing deal in 20, 25 and 30-year tranches, with roughly a third of the amount in each, has an average fixed rate period of 16 years. The weighted average spread is 47 basis points over 28-day TIIE, versus 170 basis points on the prior debt, which averaged just four years fixed. The average fixed rate dropped to 9.10% from 13.14%. The deal benefitted from significant ratings upgrades including six notches from Moodys and market i
Capitalizing on upgrades and market opportunity, State of Mexico declined to use any major investment banks for its 25 billion peso refinance which extended duration and slashed the price on most liabilities.