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Top news

With only $13m in cash against $1.7bn in short-term debt as of 30 June, state-owned Petroperu needs to refinance, urgently. The company is burning around $200m per month due to difficulties evacuating production, according to Fitch, which said in August that a “default-like event” could result from the liquidity strain.

But even though the rating agency doesn’t expect “substantial support” from the government for Petroperu’s capital structure in the short-term, bondholders seem to take government intervention for granted: the $1bn 4.75% notes due 2032 are quoted at 87 cents and were among the week’s biggest gainers, while the $2bn 5.625% notes due 2047 trade at 73.41 cents.

Much like Pemex and Mexico, the expectation is that the Peruvian government has to bail out Petroperu, given its strategic economic importance. The company employs thousands, and delivers fuel to remote Andean and Amazonian communities that private operators aren’t interested in servicing.

The federal government authorized a second bailout barely a year ago, after the NOC’s board resigned en masse. Now, several investment banks including Deutsche Bank, Goldman Sachs, Santander, and Citibank are readying reprofiling proposals at the request of the Economy Ministry.

Although the sovereign has provided liquidity in the last three years to meet immediate requirements, it’s unclear if the government and the company are open to a corporate reorganization that would stanch the cash burn, since that would require hard decisions that may be politically unpopular.

Another potential restructuring on the horizon is Murano, which missed an interest payment on its 2031s last week. If the payment isn't cured by 12 October, the company will formally enter default. Some bondholders are losing patience, but think that accelerating the debt and trying to foreclose in Mexico is complicated. They’re not wrong.

The company has tried to raise equity, and flirted with becoming a Bitcoin proxy over the summer before reversing course. These pivots may be part of the reason some investors are unhappy. Murano, which is seemingly no longer working with Rothschild, has been in our sights since May, when we highlighted how the real estate developer's cash flows had fallen short of expectations.

Braskem bonds were also among the biggest drops of the week (for the second week in a row) as rumors spread that the Tanure acquisition has stalled while the petrochemical sector downturn persists. S&P downgraded the company to issuer credit B+ with negative watch (CCC+ for its subordinated bonds), citing reduced financial flexibility and continued high cash burn.

Ambipar, another big loser this week, was flagged by 9fin on 22 August when we said the cash exodus was misaligned with improved operational performance. Weeks later, CMV opened a case against company executives on 5 September and Fitch cut the outlook to negative last week. The market was slow to react, but this week the company’s bonds finally dropped 6%–8%.

Edenor, YPF, and other Argentine corporates took a hit this week, as pre-election political noise fueled a new selloff in sovereign bonds. The country risk premium, tracked by the EMBI+, spiked to 1,425 this morning — up +500bps in September.

Aeromexico bonds have yet to drop, but keep an eye out, following the US Department of Transportation’s order to unwind the Delta-Aeroméxico alliance by 1 January 2026. The carriers can request an extension until April 2026, but barring a change of heart from the White House, they’ll eventually face increased operating costs and lose synergies. Both airlines shared revenues 50/50 in the JV, regardless of what airline a passenger flew on, and it’s unclear for now which one will lose more from the dissolution. But Aeromexico sales were already eroding since early 2025.

Biggest movers

9fin featured content

Aeromexico US order to unwind Delta–Aeromexico alliance raises risks for the Mexican carrier

CFE may tap Fibra E again as yields fall, capex needs rise

Murano misses coupon on 2031s

Pemex will soon pay suppliers, but only 2025 invoices

New Fortress Energy faces a probable event of default amidst worsening financials. New Fortress Energy bonds rise on new Puerto Rican deal chatter. Puerto Rican government releases terms of new $4bn contract with New Fortress Energy

Brazil’s credit ratings expected to withstand historic conviction of Bolsonaro.

Brazil Central Bank likely to keep Selic at 15%, maintaining high debt costs. New regulator study highlights integrity concerns in Brazil’s capital markets

Law firm Demarest expands restructuring practice,

IMPSA Third time’s a charm? IMPSA launches new out-of-court restructuring proposal

Caixa outlines plans to expand foreign funding as earnings climb

Volcan board approves refinancing plan. Gold continues to shine, as explained in the latest 9fin Mining and steel sector analysis

Petroperu's liquidity crisis forces government bailout talks — Bond recovery hinges on sovereign support

Apollo revives talks of buying a stake in Mexican soccer league

Primary market

LatAm primary market bond issuance continued strong this week with $13bn from Mexico, which pushed on with hefty funding plans ahead of the Fed. That might have left little room for anyone else, with the Fed rate decision on Thursday also serving as a blocker. The only other issue was a $70m tap of EnerguateEnerguate’s 10NC5.

Plenty of issuers are waiting in the wings, and LatAm syndicate bankers forecast a busy end to the month. One bank has a corporate ready to go, whilst another we spoke to has four to five issuers lined up, mostly Brazilian. The Fed’s first rate cut of 2025 and slightly lower dot plots were both largely expected, and bankers expect deals to flow next week, barring any surprises. Market reaction to last week’s Bolsonaro conviction was muted, and the US hasn’t retaliated so far.

Priced deal tracker

People moves

If you have any recent moves to announce, please send them to latam@9fin.com

Mexico’s FEMSA appointed Jose Antonio Fernández Garza-Lagüera, son of chairman José Antonio Fernández Carbajal, as its new CEO starting in November.

In an attempt to regain investors' trust, Ambipar announced executive changes. Pedro Borges Petersen stepped down as investor relations officer to assume the role of senior operations advisor, and Ricardo Rosanova Garcia was appointed as the new IRO.

White & Case hired Thomas S. Heather as counsel in its financial restructuring and insolvency, debt finance, and international arbitration practices, based in Mexico City. Heather — the dean of cross border restructurings in Mexico — had left the firm 15 years ago and founded his own firm, later becoming partner at Ritch Mueller & Nicolau, and office counsel at Creel, García-Cuéllar, Aiza y Enriquez.

Brazil’s Demarest Advogados hired Carolina Mascarenhas as partner to its restructuring and insolvency practice. Mascarenhas, who will be based in São Paulo, was formerly a senior associate at Machado Meyer Advogados, another prominent Brazilian firm.

The LatAm Weekly is produced by 9fin’s LatAm team Laura Aguirre, CFA, Xochitl Herrera, Marina Varady, Matias Bouza Bazan CFA, Elliott Hodgkin, Édgar Sígler, Chris Shiells, and Henry James.

Check out this announcement for more information on our expansion into Latin America.