Signum Perspectives
GRUPO BIMBO, S.A.B de C.V.
On September 3rd, 2019, BIMBO issued US$600 mn in international bonds to improve the financial profile of the company
The issuance consists of a 30-year bond (maturing in 2049) which pays a 4.0% rate.
The company said it would use the proceeds from the refinancing of portion of a US$800 mn bond maturing in 2020 with a 4.85% rate.
Bimbo’s debt amounted to US$4.649 bn at the end of Q219, representing less than two thirds of its North American sales. The debt has an average maturity of 10.1 years and an average cost of 6.0%.
The issuance lowers the company’s cost of debt and increases its maturity from 10.1 years to 13.6.
The transaction was overwritten more than five times over 150
institutional accounts concurred with, which is similar to the
transactions of other global food companies with investment
grade.
We reiterate our BUY rating with an end-Q419 target price of
$45.40 per share.