Citicorp has agreed to lead a bridge loan of about $1.2 billion for Cementos Mexicanos, a Mexican cement company whose rapid expansion plans caused some jitters in the stock market last month.

Cemex will use the loan, expected to carry highly leveraged pricing, to buy two Spanish cement companies.

Though Cemex is well regarded and has a near monopoly in its home market, investors were concerned when it announced plans in late July to buy Sanson in Spain for about $600 million.

Just a few weeks earlier, it began to purchase the stock of an even bigger Spanish enterprise, Compania Valenciana de Cementos Portland, in a transaction expected to cost about $1.25 billion.

Diversification Issue

Cemex's stock plummeted after each announcement, largely because foreign investors feared the company was diversifying too quickly into slower-growth markets.

Cemex originally planned a separate bank facility for each deal, one led by Citicorp and the other by J.P. Morgan & Co. Morgan is also merger adviser on both transactions.

Banking sources said this week the facilities have been combined under Citicorp's aegis.

Likely Syndicate Members

Morgan is expected to join the loan syndicate, along with Holland's NMB Bank and Spain's Banco Santander. Germany's Westdeutsche Landesbank also is considering a role, sources said.

Spokesmen for Citicorp, Morgan, and NMB declined to comment. Banco Santander could not be reached.

Although terms are still being worked out, the interest rate is expected to range between 275 and 325 basis points over the three-month London interbank offered rate.

A source said the bridge loan has been tailored to mature in 364 days.

Cemex has said it will repay the loan by selling nonstrategic assets in the Spanish cement companies as well as through debt and equity issues.

Both Citicorp and Morgan have worked with Cemex on underwritings. Citicorp has underwritten bonds and convertibles and acted as a dealer for other Cemex securities.

Morgan, too, recently underwrote a $400 million senior note offering for Cemex.

Analysts said that the deal is a logical extension of Citicorp's longstanding commitment to lending in Latin America.

"Banks are in the business of lending and Citicorp's active in Mexico, said Cheryl Swaim, an analyst at Oppenheimer & Co.

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