Mexico’s ICA Surges Most Since 2008 on Sale of Stake in Projects

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Empresas ICA SAB rose the most in six years after the Mexican builder announced it will receive 3 billion pesos ($197 million) from a Canadian investor in exchange for an equity stake in transportation projects.

ICA advanced 11 percent to 13.98 pesos a share at 2:02 p.m. in Mexico City, the most on a closing basis since November 2008. It was the biggest gain on the benchmark IPC index, which rose 0.4 percent.

Under the agreement, Caisse de depot et placement du Quebec, known as CDPQ, will get a 49 percent equity stake in a joint venture that will initially focus on four of ICA’s Mexican road-construction projects, according to a statement today. The move is in line with Mexico City-based ICA’s strategy to monetize assets and reduce debt, according to Vector Casa de Bolsa SA.

“Without a doubt it’s good news that confirms the company’s intention to improve its debt profile,” Jorge Placido, an analyst at Vector, said in a note to clients today.

ICA’s indebtedness during the final three months of last year was the highest in five quarters. Net debt rose to 9.11 times earnings before interest, taxes, depreciation, and amortization, according to data compiled by Bloomberg. Company officials told investors in March that they planned to sell assets and cut debt.

Chief Financial Officer Gabriel de la Concha said in an e-mail that today’s stock gain is probably due to the announcement of the deal with CDPQ.

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