Corporación Multi Inversiones collects $700 million through green bonds in the international market

Corporación Multi Inversiones collects $700 million through green bonds in the international market

April 29 2021

Guatemalan Corporación Multi Inversiones (CMI) collected $700 million through the placement of green bonds in the international market.

The debt was placed in New York (the United States) through CMI Energy which is part of CMI Capital of this business group with operations in Central America and the Caribbean, the company stated on April 27th.

This is the first time that the firm resorts to external investors in search of financing.

Likewise, the firm negotiated a syndicated loan (loans which are divided among several banks) for US$300 million.

The US$1 billion in funding, between securities and loan, will be used to refinance the debt of the conglomerate, with operations in Costa Rica.

“Through the placement of green bonds, we seek to optimize the capital structure of our company and continue with an operation of excellence, with continuous growth and the creation of positive impact for the communities where we operate” Enrique Crespo, Director General of CMI Capital explained.

The placement of these instruments involves the commitment of the issuer to perform sustainable investment.

Aldo Vallejo, Director of Corporate Affairs of CMI, explained from New York that the issuance allows simplification of the debt structure and ensure greater lender diversification. 

“Restructuring optimizes resources and creates greater flow (of money) that gives greater soundness to the group (...). The appetite of international investors is quite marked in topics of sustainability, and the topic of renewable energy is key.  For that reason, we decided to place green bonds”, Vallejo stated. 

The spokesman of CMI added that international capital markets will give the company a long-term vision. 

“The international market is actually highly critical and acid. Having the trust of international investors would give the region much more outward credibility”, Vallejo stated. 

The Company, that celebrates 100 years of its establishment, this year, operates in Central America, the United States, Mexico, the Caribbean, Ecuador, Spain, Italy, and Luxembourg. 

Costa Rica has three wind farms: Orosi, Alisios y Pesrl that, together have a 154-megawatt generation capacity.

CMI has other businesses in the country. It owns the Aliansa food production plant. Located in Orotina, that makes feed for poultry, cattle, pork, equine, tilapia and pets. When this operation started in 2017, the Company   invested $12 million.

In addition, the Pollo Rey plants and the Pollo Granjero restaurants are owned by this Guatemalan conglomerate.

It also produces and distributes consumer brands such as Cuétara, la L’Italliana pasta, Gama cookies, among others.

Details of the issue

The green bonds were placed on Monday, April 26, at a yield of 6.250% and they mature in 2029. The operation received offers five times higher than the amount of the issue.

The company confirmed that 56% of the offers received were from the United States, 29.4% from Europe, 12.3% from Latin America, and 2.3% from Asia.

“CMI Energy successfully accesses the bond markets for the first time and in this way we consolidate our strengths as a multi-Latin family group of business excellence and continuous growth, with knowledge and experience in business operations in the region,” Crespo stressed.

The company highlighted that the placement of the green bonds will contribute to the objectives of reducing greenhouse gases, decarbonization and diversification of the Central American energy network.

Rothschild & Co y Clifford Chance were CMI’s financial and legal advisors, respectively, in the transaction.

The green bonds were rated at Ba3, by Moody’s; BB-, by Fitch Ratings; and BB- by Standard & Poor’s (S&P). These were a significant improvement by comparison with previous ratings.

Source: Nación publication