Latin Finance - July/August 2009 - 8

M&A China Deal Flops by Brazil’s antitrust regulator and could face resistance because of its dominance of the local poultry sector. What was potentially the largest M&A deal of the year for LatAm Elsewhere, Pão de Açúcar (CBD) has won a hotly contested – Chinalco’s acquisition of Rio Tinto assets including part of auction to acquire Globex Utilidades and its main asset, the Chile’s Escondida copper mine – fell apart in June, taking 10% of Ponto Frio home appliances retail chain. The transaction forges volume with it. As part of the deal, Rio Tinto would have sold to Brazil’s largest retail group and second largest appliances Chinalco a 15% interest in the Escondida copper mine for $3.4 retailer, according to Banif-Ixe, with estimated l26 billion reais in billion and a 30% stake in the La Granja copper mine in Peru for annual sales. $50 million. CBD will pay 824.5-869.0 million Blackstone, JPMorgan, Nomura reais depending on whether controlling M&A Rank by Volume, Year to June 12 and China International Capital were shareholders take cash or CBD stock. Brazil exit boosts UBS advising Chinalco. Morgan Stanley and That includes a 373 million reais up Rank Advisor Value $m # deals Credit Suisse were advising Rio Tinto. front cash payout and 451 million 1 UBS 9,824.56 9 Analysts believe Rio Tinto will likely in shares to be sold over a four-year 2 Bradesco 6,965.52 11 keep its Chile and Peru assets. period, though the latter ﬁgure rises to 3 Morgan Stanley 5,674.96 6 Elsewhere, Cemex’s sale of 496 million reais if they take the entire Australian assets to Switzerland’s amount in shares, says a banker on 4 Rothschild 4,466.05 4 Holcim for $1.6 billion cash was good the deal. 5 JPMorgan 3,805.30 13 news for the company’s debtors, but CBD will also o er minority 6 Credit Suisse 3,176.75 7 not so good for shareholders, according shareholders the chance to sell at 7.59 7 Citi 2,232.29 6 to Mexican research ﬁrm Actinver. reais per share, part of which will be 8 Vergent Partners 2,220.78 1 Proceeds will be used to pay down paid for up front and part to be paid 9 Deutsche Bank 2,065.91 2 debt. Cemex has more than $4 billion for over a four-year period. If minority 10 Banco Fator 1,851.40 1 in maturities coming up in 2009. The holders participate, CBD’s payout for Subtotal 20,766.47 43 cement company’s total debt is $18 all Globex equity would be 1.1 billion billion. Creditors BBVA, BNP Paribas, reais, says Banif-Ixe. The cash portion Total 37,904.94 367 Citi, HSBC, Santander and Royal Bank of the payout will initially be paid for Source: Dealogic of Scotland advised Cemex. using CBD’s own resources, says a “[The sale] could have a positive banker on the deal, who adds that no M&A Rank by Fees, Year to June 12 e ect on the ongoing debt negotiations ﬁnancing is currently being planned. Rothschild most lucrative as the company may pay down shortCBD was advised by Estater, a São term maturities and/or holdouts that Paulo-based boutique that helped Rank Advisor Revenue $m % Share are less inclined extend maturities,” the company restructure in 2004. 1 Rothschild 38.71 22.62 says Barclays. Goldman Sachs advised Globex and 2 Banco Itaú 29.97 17.51 shareholders. 3 Credit Suisse 22.99 13.43 In Brazil’s banking sector, Bradesco 4 Citi 19.48 11.38 Brazil’s two leading poultry producers has agreed to acquire 100% of the 5 JPMorgan 15.92 9.30 Sadia and Perdigão have formally capital stock of branded credit-card 6 Morgan Stanley 8.86 5.18 announced a merger to create Brasil issuer Banco IBI and its subsidiaries IBI Foods, the world’s largest poultry Total 171.15 100.00 Corretora de Seguros, IBI Promotora processor by market cap, according to de Vendas and IBI Participações for Source: Dealogic Economatica. The combined entity, had about 1.4 billion reais in shares. The it existed in 2008, would have reported seller is retailer C&A and IBI is C&A’s ﬁnancial unit. pro forma net revenue of 22 billion reais for that year and ranked as one of Brazil’s largest food companies and exporters, with around 10 billion reais in overseas revenues, says S&P. The Australia’s Macquarie Group is acquiring Calgary-based Tristone merged companies’ pro forma combined total debt-to-Ebitda Capital Global, an advisor to the global energy industry. ratio in 2008 would have been 5.9x, compared with Perdigão’s Macquarie will pay C$116 million, including C$57 million paid and Sadia’s individual ratios of 4.6x and 7.5x, respectively, for in cash at closing and C$59 million in exchangeable shares the same period, it adds. which will be held in escrow and released over a ﬁve-year period. Sadia’s controlling shareholders will hold 10.8% of the new Tristone, which also has an o ce in Argentina, has advised on company, with the minority shareholders getting 18.6%. Pension a variety of LatAm M&A transactions. In 2008, for example, it fund Previ will get 12.2%. In all 68.0% will be held by Perdigão advised the sale of Anadarko assets in Venezuela to Petrofalcon investors and 32.0% by Sadia investors, according to Itaú. for about $200 million. Centrica, the parent company of British The company has indicated it will do a 4.0 billion reais equity Gas, is acquiring a 45% stake in a Trinidad gas development raise, though whether this will be done via the BNDES or the block from Canadian Superior Energy for $142.5 million in cash. public markets is not clear. The deal remains to be approved The seller was advised by Scotia Waterous. LF Chicken Giant Hatches Energy Revival 8 LATINFINANCE July/August 2009

Latin Finance - July/August 2009

Table of Contents for the Digital Edition of Latin Finance - July/August 2009