Rabobank is keeping busy in Brazil's domestic securitization market. Apparently, the Dutch bank is crafting a receivables investment fund (FIDC) for Companhia Brasileira de Distribuicao, which owns supermarket chain Pao de Acuzar. The transaction is heard to be upwards of R$100 million (US$33 million), according to a banker away from the deal. Collateral will be comprised of an array of assets, he said. Rabobank itself will be sole purchaser, which may explain why pricing has been reportedly set at 104% of CDI, sharply tighter than recent FIDC transactions sold into the public market. "It's cheap financing for the company and has great tax advantages for the buyer," the source said. This transaction is replicating a deal that Rabobank pulled together for foodstuffs company Sadia under the name Concordia (see ASR 5/26, p.23).

In theory, FIDCs are more attractive than other structuring finance vehicles because of a much lighter tax treatment. Steep interest rates, however, have kept pension funds and other investors focused on yieldy treasurys. And on the side of issuers, a stagnant macro-economic environment has curbed interest in the vehicles. "Candidates for this kind of transaction need a good economy," the source said. However, falling rates and greater stability point to more FIDCs in the future.

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