FUNO issues BONDS of 6.7 billion pesos for debt prepayment

FIBRA Uno (FUNO) announced that it issued bonds worth 6.7 billion pesos on Wednesday of this week. The Mexican real estate investment trust intends to utilize the funds raised from this issuance to repay an existing debt.

FUNO issued two types of bonds to raise funds. Firstly, the FUNO 23L bonds, which have a fixed interest rate (10-year M-bond basis) plus 195 basis points, with a maturity of 10 years. The amount of this type of bond issue was 4.97 billion pesos. Secondly, the FUNO 23-2L bonds have a variable interest rate (TIIE base) plus 95 basis points, with a maturity of 4 years.

FUNO 23 bonds are instruments linked to sustainability. The trust uses funds to improve its properties' sustainable aspects. Therefore, their financial and structural characteristics vary according to compliance with FUNO's predefined sustainability (or ESG) objectives.

In this regard, the trust stated, "this issue complies with FUNO's commitment to maintaining all its new financing under sustainable, green, or sustainability-related schemes, among others." The trust also reiterated that "100% of the proceeds will be used to prepay existing debt."

FUNO plans to utilize 5.1 billion pesos to pay the total debt of the FUNO 18 Bond. The rest of the funds will be used for "the prepayment of short-term credit lines," which, according to data from SiiLA FIBRA Analytics, represents a debt of 8.8 billion pesos.

The FUNO 18 Bond was issued on September 18, 2018, to repay loans with Santander, BBVA Bancomer, and Banamex.

As of December 31, 2022, FUNO had 596 industrial, commercial, and office properties totaling 11 million square meters in Mexico. At the end of the fourth quarter of 2022, FUNO's total debt was 140.4 billion pesos.

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