América Móvil in Innovative Ps. 5 Billion Notes Offering

Cleary Gottlieb represented América Móvil in the sale of Ps. 5 billion (approximately $463 million) 9% senior notes due January 16, 2016 to Mexican, U.S. and European investors. Credit Suisse First Boston and Deutsche Bank Securities acted as underwriters in the transaction, which was América Móvil’s second takedown under its $2 billion shelf registration statement.

The notes contain a number of innovative features: they are payable in U.S. dollars or Mexican pesos, are registered with the SEC, and can be settled through Euroclear, Clearstream or Indeval (the Mexican central clearing system). In recent years, Mexican “blue chip” companies have offered peso-denominated indebtedness (known as certificados bursátiles) in the local market to pension funds and insurance companies. América Móvil was able to obtain significantly better pricing by opening the deal to overseas investors. The notes were priced to yield 9.13%, with a spread of 55 basis points over the Mexican government’s 10-year peso treasury bond.

América Móvil is based in Mexico and is Latin America’s largest wireless telecommunications company. Since early 2004, Cleary has represented América Móvil in six bond offerings totaling approximately $3.6 billion.