Daily Brief Credit: News: Cemex to Divest Its Dominican Republic Operations for $950 Million and more

• The transaction is valued at approximately 6.8x 2023 EBITDA, or $396/ton, which we consider a good price given that Cemex currently trades at 5.5x LTM EBITDA, or $208/ ton.
• We view Cemex’s divestments of its Dominican Republic assets as a positive credit event that aligns with its strategic priorities.
• With this divestment, the company should focus on growing its key markets through bolt-on acquisition while maintaining its commitment to a healthy balance sheet.

• We maintain our Outperform recommendation on MercadoLibre with a preference for MELI 2.375% 2026 bonds. We remain optimistic about the company’s overall financial and business risks.
• Revenues increased by 41.5% (FX-neutral: 113%) to $5.1 billion in 2Q24. However, the EBIT margin contracted significantly by 440 bps to 14.3% from 18.7%.
• MELI ended the quarter with $976mn in net debt, down from $1.4 bn sequentially. Gross leverage remained relatively stable at 1.8x, and net leverage improved by 0.2x sequentially to 0.3x.  

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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