Alpek Seeks to Raise $853 Million in Mexico’s Biggest IPO

Alpek SAB (ALPEK), a unit of chemical company Alfa SAB (ALFAA), is seeking to raise as much as 11.2 billion pesos ($853 million) in what would be Mexico’s biggest initial public offering.

The company, based in San Pedro Garza Garcia, will sell as many as 379.8 million shares at 27.50 to 31.50 pesos apiece, according to a filing with Mexico’s stock exchange today. The shares, which will trade under the symbol ALPEK, are scheduled to be sold on April 25.

OHL Mexico SAB (OHLMEX*) had the largest Mexican IPO in November 2010 when it raised 9.7 billion pesos. Alpek’s share sale is the first announced this year in Mexico, according to data compiled by Bloomberg. The chemical maker plans to meet with foreign investors beginning today in an effort to boost demand.

An Alpek team is meeting with investors in London today, and meetings in Mexico and the U.S. will begin April 16, said Ramon Leal, Alfa’s chief financial officer. The public offer gives Alpek “the opportunity to have more independence to pursue the projects that have been presenting themselves,” he said.

The sale “will allow Alpek to expand quicker in international markets such as in Asia,” said Pablo Duarte de Leon, an analyst with Corp. Actinver SAB in Mexico City. Investors didn’t have many options in the chemical sector in Mexico’s exchange and Alpek will be a good alternative, Duarte de Leon said.

Revenue Rises

Alpek is Alfa’s largest unit, accounting for half of Alfa’s $14.7 billion of sales last year.

Alpek has 20 plants in three countries and makes polyesters used in garments and expandable polystyrene that can be used as packing material. It had sales of $7.3 billion last year, according to its website. First-quarter revenue rose 13 percent to $1.1 billion amid higher polyester sales in North America, the company said in a separate filing today.

Citigroup Inc., HSBC Holdings Plc, Credit Suisse Group AG and Morgan Stanley are managing the share sale.

Alfa rose 3.4 percent, the most since Jan. 18, to 186.80 pesos at the close in Mexico City.

To contact the reporters on this story: Carlos Manuel Rodriguez in Mexico City at carlosmr@bloomberg.net; Jonathan J. Levin in Mexico City at jlevin20@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

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