Mexico in Brief
From Mexico in Brief Newsletter
ANOTHER BILLIONAIRE INVESTMENT BY AMERICA MOVIL.
Mexico-based mobile network operator America Movil recently announced its plans to invest around U.S.$8 billion within 2021, which will be destined to the acquisition of 5G frequencies and spectrum, among other projects. America Movil has continued to grow during the global pandemic, reporting an increase of 79.6% on its net profit during the fourth quarter of last year, compared to the same quarter of year 2019.
FINSA SUCCESFULLY CONCLUDED CAPITAL RAISING ROUND.
Mexican industrial park developer FINSA has concluded its capital raising round with commitments of up to U.S.$395 million over 10 years. The proceeds raised will be used by FINSA to consolidate investments in industrial and logistics parks, in an effort to expand its presence in the Bajio region, the Northern Border, the city of Guadalajara in the Mexican State of Jalisco, and the Monterrey-Ramos Arizpe area.
PEMEX IS GREENLIGHTED TO DEVELOP EK-BALAM FIELD.
The Mexican National Hydrocarbons Commission (CNH for its acronym in Spanish) has recently endorsed the 2021 program and budget of the Mexican state-owned oil company Pemex for the development of Ek-Balam, which is the most important field being operated by Pemex under a production sharing agreement. Ek-Balam, which is located in territorial waters of the Gulf of Mexico northeast of the city of Ciudad del Carmen in the Mexican State of Campeche, will represent an investment of up to U.S.$804.5 million. Pemex expects to retrieve this year a volume of 31.92 million oil barrels and 7.45 billion cubic feet of gas.
CFE IS BACK TO PLACING BONDS IN THE U.S. FINANCIAL MARKET.
For the first time in four years, the Mexican Federal Electricity Commission or CFE, has placed two bonds in the United States’ financial market for around U.S.$2 billion total. The first bond is worth approximately U.S.$1.2 billion with a 10-year maturity date and will grant an annual yield of 3.348% to its investors, while the second bond is worth around U.S.$800 million with a 30-year maturity date and an annual yield of 4.677%. The CFE will use the proceeds of these bonds to refinance a bond expiring in May 2021 and to finance part of the new investments contemplated in its business plan for years 2021-2025.
MEXICAN GOVERNMENT PLACED MILLIONAIRE BONDS.
The Mexican government recently placed bonds in the local debt market for a total amount of approximately U.S.$822 million. The bonds have a real interest rate fixed for 10 years, a maturity date set for November 2031, and will pay a coupon of 2.75%with a yield of 1.75%. According to the Mexican Ministry of Public Finance and Credit, the placement involved the participation of national and foreign investors, and had a total demand of more than U.S.$1.61 billion.
MEXICAN FEDERAL MORTAGE CORPORATION PLACED STOCK CERTIFICATES.
The Mexican Federal Mortgage Corporation, or SHF for its acronym in Spanish, recently placed two stock certificates for about U.S.$288 million with maturity dates of three and five years. Both placements had a demand of more than U.S.$1.24 billion, which is almost four times the amount issued. The issuance of these certificates is part of SHF’s annual financing plan for year 2021 to continue with the placement of resources for the construction and self-building of houses.
ELECTRICITY GENERATION PROJECTS ANNOUNCED BY RENGEN ENERGY.
Mexican energy company Rengen Energy, plans to launch at least three electricity generation projects within the first quarter of this year, which will represent an investment of more than U.S.$500 million. These three projects include a combined cycle power plant that is being developed jointly with the Mexican Federal Electricity Commission and which will take around three years to be completed, a solar farm of 180 MW in the Northern region of the country to be developed with a private client which will take up to a year of construction, and smaller projects of electricity generation with industrial parks.
KCSM WILL INCREASE ITS RAILWAY INFRASTRUCTURE.
Railway company Kansas City Southern de Mexico or KCSM, a Mexican subsidiary of U.S.-based Kansas City Southern, recently announced an investment of approximately U.S.$118 million in railway infrastructure across Mexico, looking to serve the operational growth of its clients. The amount of said investment may increase as it does every year, as declared by the company’s CEO. KCSM’s strategy involves increasing its capacity mainly in the cities of Monterrey and San Luis Potosi.
WALMART INCREASES ITS INVESTMENT IN MEXICO.
U.S.-based retail store Walmart de Mexico and Centroamerica is planning to invest approximately U.S.$1.06 billion within 2021, which will represent an increase of 32.99% compared to its investment last year. A 40% of such amount will be destined to existent retail stores, a 25% will be invested in logistics and new stores, and a 10% will be dedicated to Walmart’s e-commerce and technology.