Mexico has completed a debt refinancing operation worth US$ 6.6 billion in international markets, including a heavily over-subscribed bond offer, the Finance Ministry said.
The operation, which had three components, included the issuance of two new bonds: one at 10 years, maturing in 2031, for US$1.825 billion and a coupon of 2.659%; one for 40 years, maturing in 2061, for US$1.8 billion with a coupon of 3.771%.
With demand hitting US$ 16 billion, the offer was more than four times over-subscribed and drew 300 institutional investors, the Finance Ministry said in a statement.
Deputy Finance Minister Gabriel Yorio said the government secured one of the lowest interest rates in the market.
“Mexico does these types of refinancing transactions when it identifies ideal opportunities in the market and they are carried out without incurring additional debt,” Yorio said on Twitter.
In addition, investors with bonds maturing between 2023 and 2030 could exchange them for the new 10-year bond, while bonds maturing between 2046 and 2050 could be switched for the new 40-year bond, improving Mexico’s external debt maturity profile.
The government plans to buy back two bonds maturing in 2022, allowing it to reduce its amortization of foreign market debt scheduled for 2022 by 75%.