On June 21, 2023, the Province of Mendoza issued its first Sustainable Bonds for an amount of AR$ 4,876,673,332, and New 2024 Bonds for an amount of AR$ 2,633,120,511 as part of its debt refinancing strategy.
The Sustainable Bonds were issued with a variable interest rate composed of the BADLAR rate plus an annual rate of 5.90% and mature on June 21, 2025. The New 2024 Bonds were issued with a variable interest rate composed of the BADLAR rate plus an annual rate of 5.75% and mature on December 21, 2024, both secured with Federal Tax Co-Participation Regime resources.
The Province will use the net proceeds from the issuance of the Sustainable Bonds to finance the expansion of Mendoza’s Metrotram system (Metrotranvía), in accordance with the guidelines of ICMA's "Sustainable Bonds Guide". The project aims to expand the existing tram network, enabling its extension into new neighborhoods, significantly reducing travel times, reducing traffic accidents and promoting the use of renewable energy by increasing the use of public transport, while reducing carbon dioxide (CO2) emissions. The Sustainable Bonds are listed on the Mercado Abierto Electrónico (MAE) and on the "Social, Green and Sustainable Panel" of Bolsas y Mercados Argentinos (BYMA).
As part of its debt refinancing strategy, the Province offered to exchange all of its outstanding PMJ23 Bonds, which matured in June 2023, for New 2024 Bonds, maturing in December 2024. The Province successfully exchanged more than 50% of the total outstanding PMJ23 Bonds, issuing in exchange New 2024 Bonds for an amount of AR$ 2.633.120.511. The New 2024 Bonds are listed on MAE.
Banco de Galicia y Buenos Aires S.A.U., Banco Santander Argentina S.A. and TPCG Valores S.A.U., acted as Arrangers and Placement Agents of the transaction.
Legal advisors to the Province
DLA Piper Argentina advised the Province of Mendoza through partner Justo Segura and associates Federico Vieyra and Marcelo Ra.
Legal advisors to the Arrangers and Placement Agents
Bruchou & Funes de Rioja advised Banco de Galicia y Buenos Aires S.A.U., Banco Santander Argentina S.A. and TPCG S.A.U., through partner Alejandro Perelsztein and associates Manuel Etchevehere and Branko Serventich.