Alfa’s Successful Consent Solicitation

Cleary Gottlieb is representing J.P. Morgan Securities LLC, Scotia Capital (USA) Inc., and SMBC Nikko Securities America Inc., as solicitation agents, in a consent solicitation and CUSIP exchange offer by Alfa, S.A.B. de C.V. (Alfa) relating to its $500 million 6.875% senior notes due 2044.

The consent solicitation aims to amend certain covenants and provisions to clarify that Alfa may spin-off its subsidiary Alpek S.A.B. de C.V. (Alpek), as well as to allow Sigma Alimentos S.A. de C.V. (Sigma) and certain of its subsidiaries (the guarantors) to provide guarantees with respect to all or a portion of Alfa’s outstanding notes.

The consent solicitation commenced on September 10, 2024, had an early expiration deadline of September 23, 2024, and will expire on October 7, 2024. By the early expiration deadline, Alfa had received consents from holders representing approximately 89.5% of the principal amount of notes outstanding. Having achieved the requisite majority of required consents by the early expiration deadline, on September 23, 2024, Alfa implemented the proposed amendments and executed a supplemental indenture to the indenture governing the notes.

Subject to shareholder approval of Alpek’s spin-off and other conditions described in the solicitation materials, following the expiration date Alfa will pay a consent fee in cash to holders who validly delivered consents before the early expiration deadline, and will cause the guarantors to deliver a full and irrevocable guarantee for the benefit of all holders of outstanding notes.

Alfa is a Mexican conglomerate and one of Mexico’s largest public companies based on revenues. Alfa conducts its operations through two business units: Sigma, a leading producer, marketer, and distributor of branded foods, and Alpek, one of the world’s leading producers of petrochemical products and the leader in Mexico for polypropylene and expandable polystyrene. Cleary had previously represented the various underwriters in Alfa, Sigma, and Alpek’s inaugural 144A/Regulation S bond offerings in the United States.