Grupo Aeromexico SA, the country’s biggest airline, may raise as much as 2.7 billion pesos ($227 million) in an initial public offering as the company adds routes and buys jets after its largest rival went bankrupt.
Aeromexico will sell shares worth as much as 2.4 billion pesos in Mexico, and underwriters may buy an extra 358 million pesos in stock as part of an overallotment option, according to a prospectus e-mailed yesterday. The offering is set to be priced from 30 pesos to 34 pesos a share on April 13.
The airline, based in Mexico City, will invest more than 16 billion pesos to buy 20 airplanes, update technology and expand routes, Chief Executive Andres Conesa said yesterday. Cia. Mexicana de Aviacion, which had been the country’s largest airline, filed for bankruptcy and halted operations last year, leaving room for other carriers to pick up its customers.
“In theory, there are routes that aren’t being attended to after Mexicana left,” said Martin Gonzalez, an analyst with Invex Casa de Bolsa SA in Mexico City.
The jet purchases planned by Aeromexico include 10 Embraer SA 190s and 10 Boeing Co. 737s, Conesa said.
The underwriters on the sale, the second IPO in Mexico this year, are Citigroup Inc.’s Banamex unit, Corp. Actinver SAB and Deutsche Bank AG. Aeromexico said it will carry out a separate private offer at the same time as the public sale.
“There’s a good short-term outlook for the market, and that could help investors,” said Gerardo Copca, an analyst with Metanalisis SA. Aeromexico and investors in the IPO should benefit from a “stable” Mexican stock market that may be poised to rally, Copca said in a telephone interview.
Mexico’s benchmark IPC index of 37 stocks climbed 0.6 percent to 37,440.51 at 4 p.m. New York time. The gauge advanced 1.1 percent this month, trimming a first-quarter decline to 2.9 percent.
Aeromexico posted consolidated net income of 2.3 billion pesos last year, the prospectus showed.
Mexicana said March 9 that it is evaluating proposals from investors to restart operations.
Besides a namesake carrier, Aeromexico also operates Aeromexico Connect and AM Travel units. It’s Mexico’s biggest airline operator by number of airplanes and passengers. The company had 36.2 percent of the country’s domestic market last year, the prospectus showed. The company also flies to the U.S., Canada, Europe, Asia and other Latin American countries.
Fibra Uno de Administracion SA raised 2.6 billion pesos this month in Mexico’s first sale of real estate securities known as Fibras, which are similar to U.S. Real Estate Investment Trusts, or REITs.
Luis Tellez, chief executive officer of exchange operator Bolsa Mexicana de Valores SAB, said March 29 that there would be two IPOs in Mexico by summer. Mexico had five initial offerings last year after a 22-month drought, according to data compiled by Bloomberg.