Mexico’s development bank trust Fonadin will receive a 45 billion peso ($2.5 billion) contribution from the Finance Ministry to purchase a 51% stake in the deal to buy power plants from Spain’s Iberdrola SA.
(Bloomberg) — Mexico’s development bank trust Fonadin will receive a 45 billion peso ($2.5 billion) contribution from the Finance Ministry to purchase a 51% stake in the deal to buy power plants from Spain’s Iberdrola SA.
In addition to the majority stake, Fonadin will oversee a special purpose vehicle that will execute the operation, Mexico’s Finance Minister Rogelio Ramirez de la O said at a press briefing Wednesday. Mexico announced on April 5 that it would buy a fleet of natural gas plants and a wind farm for $6 billion from the Spanish company.
“What interests us is that Fonadin has 51% of the risk capital,” Ramirez de la O said. Iberdrola will get 3.6% annual interest rate of the plants’ earnings until the deal is closed, he added.
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“All the big banks” have approached the Mexican government to offer financing for the deal, Ramirez de la O added. Banco Bilbao Vizcaya Argentaria, Banco Santander SA and Bank of America Corp are among lenders that have expressed interest in financing the deal, Bloomberg News reported last week.
“We have money available for this,” Ramirez de la O said.
–With assistance from Maya Averbuch and Michael O’Boyle.
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