In its second large financing in Mexico this month, Milbank, Tweed, Hadley & McCloy advised four principal lenders in an $800 million syndicated financing for Ternium México S.A. de C.V., a leading steel, plastics, and aluminum processor that is the Mexican arm of Luxembourg-based steel concern Ternium SA (NYSE:TX).
New York-based partners Carlos Albarracín and Michael Bellucci led the Milbank deal team on behalf of lead arrangers Crédit Agricole CIB, HSBC Bank USA, Bank of Tokyo-Mitsubishi UFJ, and Natixis Global Asset Management. The syndicate, comprised of a total of 11 financial institutions, focused on Mexican banks or Mexican branches of international banks.
Based in San Nicolás de los Garza, near Monterrey, Ternium specializes in value-added steel products for use in construction, automotive, energy, and appliance sectors, among others. It operates production and distribution centers throughout Latin America. The company will use proceeds from the loan to finance an existing credit facility and for general corporate purposes.
Mr. Bellucci, of the firm’s Leveraged Finance group, said, “We’re pleased to help lead this major financing for Ternium, one of Latin America’s pre-eminent players in steel production and iron ore.”
Mr. Albarracín, a member of Milbank’s Global Securities practice, added, “Mexico’s industrial sector continues to show signs of strength and increased capacity. This transaction, bringing together a top-tier group of global financial institutions for a large loan package, reflects the caliber of financing opportunities we are seeing in Mexico and the rest of the region.”
The deal also illustrates the growth of Milbank’s financial and capital markets deal book in Mexico. Earlier this month, the firm’s leading Latin America group concluded three bond issuances by Mexico’s state-owned oil company, Pemex, with a total value of $1.5 billion. A $750 million portion of that offering represented the biggest single bond issue ever guaranteed by the U.S. Export-Import Bank.
In addition to Messrs. Bellucci and Albarracin, the Terniun financing team included Milbank Leveraged Finance associates Todd Koretsky and Bianca Gersten.
