MEXICO CITY (Reuters) - Mexican cement maker Cemex (CEMEXCPO.MX) said late on Tuesday that it plans to issue $1 billion worth of bonds, with a 7.375% coupon and a maturity date of June 2027, to support ongoing business activities, including debt repayment.
The bonds will be issued with an option to repurchase them four years prior to maturing and the offering period will close on June 5, the Monterrey-based company said in a statement to the stock market.
On Monday, Cemex warned its business may suffer if recent rule changes announced for Mexico’s electricity market end up limiting the generation of renewable energy and imposing new costs.
Mexico’s energy regulator approved last week new rates that electricity providers must pay the national power utility for transmission, which a prominent business lobby group estimated were between five and 10 times higher than current prices.
Cemex said that while the impact of these changes was not yet clear, they could have an “adverse effect” on its business, operations and contractual obligations in the country.
In late April, it already forecast that its debt will increase between $25 million and $50 million this year as Latin America’s second-largest economy reels from the impact of the novel coronavirus.
Reporting by Adriana Barrera and Stefanie Eschenbacher; Editing by Muralikumar Anantharaman