E-Malt.com News article: 4051

Colombia, Bogota: Grupo Empresarial Bavaria (GEB), the largest beverage company in Colombia and the second largest brewer in South America, announced on January 20, 2005 that its parent company, Bavaria S.A., successfully placed Ps. 561,800 million (US$ 238 million) in 10 year bonds in the Colombian market. The placement results demonstrate the appetite of investors for the long-term obligations of Bavaria and cement the company’s position as the largest issuer of corporate bonds in the domestic market.

The placement is part of the Bond Issuance and Placement Program authorized by the Colombian Superintendency of Securities (Supervalores) in June 2004, with a global amount of Ps. 1 trillion (US$ 423 million). Previous placements under the program totaled Ps. 438,200 million (US$ 185 million).

Bavaria offered on January 19 a first tranche of 10-year bonds for Ps. 300,000 million (US$ 127 million), to be allocated by auction today. Total demand was Ps. 1,476,560 million (US$ 625 million), or an excess demand of Ps. 1,176,560 million (US$ 498 million). The size of the placement was increased to Ps. 561,800 million (US$ 238 million), using the optional excess allocation provisions of the bond program. The cut-off interest rate was IPC + 6.52 percent, which is 40 basis points above the reference rate for equivalent treasury securities (TES). The bonds are payable in a single payment at maturity.

The resources provided by this placement will be used in their totality to repay other financial obligations, which will increase the average life of Bavaria’s debt. The bonds are rated AAA by Duff & Phelps de Colombia, and carry the aval of Bavaria S.A. subsidiaries Cervecería Unión S.A., Maltería Tropical S.A., Productora de Jugos, S.A., Cervecería Nacional S.A., and Latin Development Corporation. The Placement Agent for the issuance was Correval S.A. Information regarding the issuance is available at Bavaria’s Investor Relations Division, the Superintendency of Securities, the Colombian Stock Exchange, and the offices of the Placement Agent. Convenience translation amounts are calculated based on the January 20, 2005 exchange rate of Ps.2,363.69 per dollar.

Grupo Empresarial Bavaria (GEB) is the largest beverage company in Colombia and the second largest brewer in South America. Its Águila, Cristal, Pilsener, and Atlas brands are industry leaders in Colombia, Peru, Ecuador, and Panama, respectively. GEB also markets soft drinks, fruit beverages, bottled water, and milk. GEB’s parent company is Bavaria S.A., listed on the Colombian Stock Exchange.


22 January, 2005