Cleary Gottlieb and Sullivan & Cromwell Bring $6B in Notes to Market for Mexico
Mexican firm Ritch, Mueller, Heather y Nicolau also helped guide the issuance through turbulent markets.
May 08, 2020 at 01:36 PM
2 minute read
Cleary Gottlieb Steen & Hamilton and Sullivan & Cromwell helped bring a $6 billion offering of notes to market for Mexico in April, despite difficult market conditions as the new coronavirus rattled investors.
Proceeds from the April bond sale will be applied to general government purposes, including the refinancing, repurchase or retirement of Mexican sovereign debt. The 2025 notes yield 3.9%, while the 2032 notes yield 4.75% and the 2051 notes yield 5%.
New York-based Cleary partners Nick Grabar and Jorge Juantorena guided the sovereign through the launch of three new benchmark bonds, which priced April 22 and closed five days later.
Sullivan & Cromwell partners Chris Mann, Bob Risoleo and Werner Ahlers advised the underwriters—Citigroup, Goldman Sachs, J.P. Morgan and Santander—alongside Mexican counsel Luis Nicolau and Carlos Obregón of Ritch, Mueller, Heather y Nicolau.
The Cleary team said demand for the notes reached "historically high levels, demonstrating international investors' continued confidence in the country" despite volatile market conditions due to the COVID-19 pandemic.
The sale came on the heels of a downgrade of Mexico's credit rating by Moody's Investors Service. The credit rating agency slashed Mexico's creditworthiness to "Baa1"—which is still investment grade—April 17 due to a deteriorating economic outlook for the country and mounting financial troubles at state oil firm Pemex.
Mexico slipped into recession in 2019. Private sector analysts forecast gross domestic product could shrink by up to 10% this year as the coronavirus darkens already dim expectations.
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