Cemex Prices US$1.5bn 5.750% 2036 Senior Unsecured Notes

Buy on the New 10Y, Driven by Carry and Liquidity

Cemex priced US$1.5 billion of 5.750% Senior Notes due June 5, 2036. The notes have a June 5, 2026 issue date, mature on June 5, 2036, and pay interest semiannually. They were priced at 99.572 to yield 5.807%, with an issue spread of 135 bps over the UST 4.375% due May 15, 2036. The notes are senior unsecured obligations guaranteed by Cemex Corp. and are rated BBB- by S&P and Fitch. They are callable at par on March 5, 2036. Cemex intends to use the proceeds for general corporate purposes, which may include the repayment of indebtedness and other financial obligations, including all or part of outstanding borrowings under certain credit agreements.

We maintain our Neutral issuer level view on Cemex and assign a Buy recommendation to the new 2036 notes. The issuer call reflects a restored investment grade profile that is already well reflected in spreads, while the bond call reflects what we view as the cleanest 10Y entry point on the Cemex curve. We view the Buy recommendation as driven by carry, benchmark liquidity and curve access, rather than by a clear new issue discount. The 2036s did not price with an obvious spread concession, but they offer a near par entry point, 5.8% YTW, full benchmark size and a more efficient longer dated expression than the existing 2029, 2030 and 2031 notes.