LatAm Bonds

Analysts are speculating that Chilean bus operator Alsacia’s negotiations with government and bondholders has hit a stumbling block. The company has, however, successfully extended the forbearance period from August 22 to August 29, allowing it to avoid falling into default.

In a week in which the last South American nation to default on international debt notched up another upgrade, analysts said that Argentina — 13 years after its default — was further from international markets than at any point in recent months.

Fixed income analysts showed little enthusiasm on Wednesday for Argentine president Cristina Kirchner’s plans to offer foreign law bondholders the chance to switch into local law notes and thus receive the payments blocked by US courts.

Latin America’s highest rated and most developed economy is proving a surprising source of concern for EM high yield bond portfolio managers this summer. Bus company Alsacia became the first firm to miss a bond payment on Monday and two other credits are trading at levels that suggest bad news is on the way.

Chilean bus operator Inversiones Alsacia’s bonds rocketed 19 points in secondary market the day after it missed an amortisation and coupon payment after the company released details of its debt restructuring.

Santiago de Chile bus operator Inversiones Alsacia missed a payment due on its dollar bonds on Monday and said it had reached the beginnings of a restructuring agreement with bondholders. The issuer went on to launch a scathing attack on Chilean authorities for changes in the concession that led to its weak financial position.

Three former Fitch credit analysts have launched an advisory boutique to help companies in inflation and recession hit Argentina to obtain financing.

Brazilian meatpacker Minerva provided bond investors with their only chance for new LatAm paper this week, and the book size and aftermarket performance showed that new issue conditions have not at all cooled for the August holidays.

One of the key holdout creditors in the Argentine debt saga dismissed any hope of a settlement with the private sector this week, leaving a cure for the sovereign’s default looking further away than ever.

Brazilian meatpacker Minerva took advantage of an empty Latin America new issue market to fetch a well oversubscribed tap of its outstanding 2023s with a narrow premium on Thursday, increasing the planned size of the tap in the process.

Carlos Slim's telecoms company, América Móvil has hired an advisory firm to evaluate the performance of the market makers in its innovative peso-denominated bond programme, a source at the Mexican company said.

The mood among investment bankers in Mexico City is increasingly buoyant as Mexican president Enrique Peña Nieto signed into law energy reforms that are expected to provide a long term lift to the country’s growth and opportunities for financiers operating in the country.