Source: Cemex, S.A.B. de C.V.

In recent weeks, Mexico's Cemex has taken extreme measures to get its debt issues under control, culminating in announcements that the company has completed a comprehensive refinancing and that it would commence a global public offering of an additional 1.2 billion shares.

In mid-August, Cemex laid out a refinancing plan that extends the maturities of approximately $15 billion in syndicated and bilateral obligations for a semi-annual amortization schedule, with a final maturity of February 14, 2014. At the core of the revised maturity schedule involves paying LIBOR plus 450 bps (Basis Point) to its bank creditors and a fixed rate of 8.91 percent to its private placement creditors that represent $895 million of the total refinancing package.

Shortly after a September 4 Extraordinary Shareholders Meeting, the company announced that it commenced a global public offering of 1.2 billion of its Ordinary Participation Certificates (CPOs), directly or in the form of American Depositary Shares (ADSs), plus up to an additional 180 million CPOs to cover over-allotments. Included in the offering are 595 million CPOs that will be sold on Cemex’s behalf by three of its subsidiaries.

Of the 1.2 billion CPOs being offered, it is expected that 900 million CPOs will be offered in the United States and in other countries outside Mexico, while about 300 million CPOs will be offered in a concurrent public offering in Mexico. The transaction is subject to market and other conditions. 

J.P. Morgan, Citi, Santander Investment, and BBVA will act as global coordinators for the global offering. Cemex intends to use the net proceeds from the global offering to pay down debt as required by the refinancing agreement.