(Bloomberg) -- Mexico is preparing to sell up to $1.5 billion in debt to pay off a bridge loan from global banks to fund its $6 billion purchase of power plants from Spain’s Iberdrola.
Talks with investors, via a private sector vehicle structured by the government, kick off on Wednesday on the notes that Fitch Ratings and Moody’s Ratings both slapped grades just above junk levels while S&P Global Ratings gave the debt a ‘BBB’ rank two notches into investment grade.
Mexico has been shedding its risk on the purchase of the plants by selling $852 million of equity to local institutional investors last month. The deal has been heralded as a sea change in Mexico after President Andres Manuel Lopez Obrador skirmished with private energy investment during his term.
Barclays, Banco Bilbao Vizcaya Argentaria, Santander, and SMBC Nikko, the banks that issued the bridge loan, are bookrunners on the deal.
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