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Latham & Watkins Advises on US$1.56 Billion Financing in Mexico

October 17, 2022
Multidisciplinary team led by members of the firm’s Latin America Practice and Energy & Infrastructure Industry Group advised on the fully-underwritten facility provided to Mexico’s first private marine natural gas pipeline.

Latham & Watkins advised the joint global coordinators, lead arrangers, and bookrunners in connection with the US$1.56 billion five-year term loan credit facility refinancing of shareholder loans provided to Mexico’s Infraestructura Marina del Golfo (IMG), the owner and operator of the Sur de Texas-Tuxpan natural gas pipeline.

The pipeline, the first private marine natural gas pipeline in Mexico and a strategic part of the country’s energy infrastructure, connects the south of the US state of Texas with the Mexican states of Tamaulipas and Veracruz along the Gulf of Mexico coast, reinforcing the reliability of the Mexican natural gas network and bolstering access to low-cost natural gas by these two leading Mexican state economies. The pipeline’s capacity is fully committed to CFE, Mexico’s state-owned electric utility and largest power generator, under a 35-year transportation services agreement.

The pipeline was designed, engineered, built, and commissioned by IMG, a joint venture of TC Energy Corporation and Sempra Energy, among the first private-sector companies to enter the Mexican energy infrastructure business. TC Energy, listed on the Toronto Stock Exchange and the NYSE, is a leader in developing and operating North American energy infrastructure. Sempra Energy, a Fortune 500 company listed on the NYSE and the Mexican Stock Exchange, is the owner of one of the largest energy infrastructure networks in Mexico through its business platform Sempra Infrastructure Partners. The transaction exemplifies TC Energy’s and Sempra’s commitment to investing in the region’s development by operating strategic infrastructure that provides energy to millions of users.

Following execution of commitment and credit facility documentation and the funding of the fully underwritten term loan, the lead arrangers successfully achieved primary syndication of the facility among a group of global and Mexican banks.

Latham fielded an interdisciplinary team, including members of its Latin America Practice and Energy & Infrastructure Industry Group, led by partners Sony Ben-Moshe, Roderick Branch, Omar Nazif, and counsel Marcela Ruenes, with associate Carlos Ibargüengoitia.