Subscriptions of the securities issued by Fideicomiso Financiero Camino a las Sierras 1 took place on January 8, 9 and 10 for a total amount of USD 93 million on the Bolsa Electrónica de Valores exchange.
The subscription was conducted in two stages: the first included the competitive and noncompetitive tranches, and the second was reserved for the trustor’s subscription of securities depending on the outcome of the first stage. The debt securities were issued in two series (series 1 and series 2) and received an investment grade rating AA.uy by the rater CARE Calificadora de Riesgo S.R.L. The securities will make annual payments of principal and interest at a rate of 5.9% and 2% default interest, regardless of the series.
Total demand for the issue in the competitive tranche was USD 161,350,000, 73% higher than the amount offered, with no demand in the noncompetitive tranche. The issuer awarded the total of the best offers in Series 1 for USD 26.5 million and opted for a cut-off price in Series 2, awarding USD 42.75 million of the USD 66.5 million to be placed in that Series, and used the second stage for the trustor to complete Series 2 by acquiring the USD 23.75 million not accepted in the competitive placement. The financing instrument was very well received by the market in general, with participation in the two stages of the subscription.
The issue’s purpose is to finance strategic projects of Camino a las Sierras S.A., the Route 8 toll operator since the year 2002 and subsidiary of Colier S.A., a national leader in Uruguay’s highway infrastructure sector.
This financing will allow the company to carry out the project for expansion of Route 9, impacting very positively on Uruguayan highway infrastructure and in particular on the tourist sector, given it will offer a fast alternative to Ruta Interbalnearia, the highway connecting the country’s capital to eastern Uruguay.
The trust assets are credit rights in the amount of USD 126 million which Caminos a las Sierras transferred to the trust based on payments that the Ministry of Transport and Public Works (MTOP) will make to it for works on the two routes.
Since the MTOP payments are irrevocable, and independent from the rest of the concession conditions, it is possible to insulate them from the rest of the natural operating risks of a construction company and generate an instrument that significantly reduces financial costs. This allows the company to offload the financing without the performance risk given to MTOP, deleverage, and continue to attract works with the possibility of once again offering financing to its client.
Camino a las Sierras S.A. acted as trustor and EF Asset Management AFISA, the FERRERE fiduciary, as trustee, registrar and paying agent.
Legal structuring for the issue was handled by FERRERE, led by Diego Rodriguez and Cecilia Trujillo.
Financial structuring of the issue was handled by QUALITAS, led by Esteban Vidal.