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MEXICO EQUITIES: Harnessing investment

MEXICO EQUITIES: Harnessing investment

March 22, 2016 | Aaron Weinman
Mexico’s state-owned oil company Pemex is set to debut the Fibra-E equity instrument this year, a vehicle designed to boost investments in energy and infrastructure assets. But depressed oil prices and uncertainty are leaving investors wary

Bonds Corporate & Sovereign Strategy Mexico

With Mexico’s oil and gas sectors now open to private investment, issuers are circling the newly minted Fibra-E structure as an avenue to billions of dollars of funding. The Mexican government published in September 2015 the rules and tax regulations for the Fibra-E, an equity investment trust that borrows elements of the US’ master limited partnership (MLP). Almost 150 oil and gas-related firms have spun-off assets into MLPs in the last 25 years. Total market capitalization of MLPs stands at about $481 billion, with the midstream energy and natural resource sectors accounting for $383 billion, according to Moody’s. In a Fibra-E, issuers place assets into a trust, and investors that purchase

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