Bloomberg News

Mexico Said to Start Marketing Samurai Sale for This Month

May 15, 2012

Mexico started marketing a sale of Samurai bonds which aren’t guaranteed by the Japanese government and plans to price the notes this month, according to a person with direct knowledge of the matter.

The Latin American nation will price the three-year notes to yield from 80 basis points to 100 basis points more than the yen swap rate, said the person, asking not to be identified because the information is private.

It will also offer five-year Samurais yielding from 100 basis points to 120 basis points more than the benchmark, the person said. The bonds won’t be guaranteed by the Japan Bank for International Cooperation, unlike the last two sales of the securities by Mexico, the person said.

Mexico joins Rabobank Nederland and Export-Import Bank of Korea in tapping the Samurai bond market this month. The extra yield investors demand to own yen-denominated debt instead of government notes declined 46 basis points this year to 113 yesterday, according to Bank of America Merrill Lynch index data. The Korean lender may raise more than 80 billion yen ($1 billion) as early as this week, the peninsula nation’s record offering in the market, Chief Financial Officer Kim Yoon Yung said yesterday.

Mexico plans to raise 10 billion yen equally split between the two maturities, according to a filing with Japan’s Finance Ministry today. Citigroup Inc., Mitsubishi UFJ Morgan Stanley Securities Co., Nomura Holdings Inc. and SMBC Nikko Securities Inc. are helping Mexico with the sale, it said.

Last Samurai

The country last tapped the Samurai market in October 2010 when it raised 150 billion yen from a sale of 10-year 1.51 percent bonds at a spread of 50 basis points, according to data compiled by Bloomberg. The notes are 94 percent guaranteed by JBIC, the data show.

The yield on the 1.51 percent bond relative to the yen swap rate was 57.1 basis points yesterday, according to JS Price.

Mexico’s foreign-currency long-term debt is rated BBB by Standard & Poor’s, its second-lowest investment grade, with a stable outlook, according to data compiled by Bloomberg.

America Movil SAB, the Mexico-based wireless carrier controlled by billionaire Carlos Slim, raised 12 billion yen in October from a sale of Samurai bonds, including three-year 1.23 percent notes at a spread of 80 basis points and five-year 1.53 percent debt at a spread of 100 basis points, data compiled by Bloomberg show. The company is rated (AMX:US) A-, or two levels higher than the government, the data show.

To contact the reporter on this story: Yusuke Miyazawa in Tokyo at ymiyazawa3@bloomberg.net

To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net


Race, Class, and the Future of Ferguson
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • AMX
    (America Movil SAB de CV)
    • $24.16 USD
    • 0.22
    • 0.91%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus