Mexico: Pemex announces measures to improve its financial situation
With the support of the Government, the company seeks to improve its balance sheet for the next few years.
Petróleos Mexicanos (“Pemex”) has announced various measures intended to strengthen its financial condition alongside the Mexican government. The initiative involves the commencement of an offering of U.S. dollar and conducting a liability management transaction for some of its outstanding securities. In addition, the Ministry of Finance and Public Credit of Mexico said it will make a capital injection of up to US$3.5 billion in Pemex.
The firm is committed to use the proceeds of both measures to fund the liability management transaction. The offering of global notes will constitute unsecured obligations of Pemex and will be guaranteed by the Pemex Exploración y Producción, Pemex Transformación Industrial and Pemex Logística divisions.
According to a press release, the liability management transaction does not target its securities maturing in 2022 and 2023. This relates to the commitment by the Government of Mexico to ensure budgetary allocations for additional capital injections to Pemex to cover those maturities.
In addition, the Government of Mexico also announced a series of measures to improve the company’s financial position.
