- Company could raise at least $750 million, two people say
- Jose Cuervo's sales surged 41% in first three quarters of '15
Jose Cuervo, the world’s biggest tequila producer, has started talking with banks about an initial public offering in Mexico, according to people with knowledge of the situation.
The company, which is controlled by the billionaire Beckmann family and based in Mexico City, may sell shares later this year or early 2017, according to three of the people, who asked not be identified because they weren’t authorized to discuss the matter. One of the people said the company behind the 250-year-old brand needs time to meet the corporate governance and financial disclosure requirements required to go public.
While Chief Executive Officer Juan Domingo Beckmann has signaled since at least 2006 that a stock listing was under consideration, most recently reportedly saying in October that an IPO could come in the next 12 months, the company hasn’t pulled the trigger. The idea is now more advanced, according to two of the people.
The share sale could total $750 million or more based on the size of company, two of the people said. It’d come as the Beckmann family embarks on a plan to transform the area surrounding the town of Tequila, Mexico, into a Napa Valley-like destination for tourists and aficionados of the spirit made from blue-agave plants. Cristobal Mariscal, Jose Cuervo’s legal director, declined to comment on a possible stock listing.
Jose Cuervo’s revenue surged 41 percent in the first three quarters of 2015 from a year earlier to 10.25 billion pesos ($575 million), according to the most recent data from the distiller. A Cuervo company that later became part of its holding corporation Becle SA sold $500 million of 10-year bonds last year to finance the purchase of the Bushmills whiskey brand from London-based beverage conglomerate Diageo Plc.
The yield on the debt, which is due May 2025, rose 0.03 percentage point to 4.05 percent at 9:52 a.m. in New York on Wednesday, according to data compiled by Bloomberg.