Fibra Uno Plunges in Mexico City on $4 Billion Share-Sale Plan
Fibra Uno Administracion SA (FUNO11), which owns a stake in Mexico City’s tallest building as the nation’s largest real estate trust, fell the most since May after announcing plans to issue as much as $4 billion in new stock.
Shares sank 3.9 percent to 41.15 pesos at 1:27 p.m. in Mexico City. Citigroup Inc. lowered its recommendation on the stock to hold, citing a 12 percent rally over the past six months and the plan for a capital increase.
Investors may also be concerned that the company hasn’t given more information about what it plans to do with the money it’s raising with the stock sale, according to Caimi Franco, an analyst at Brasil Plural in Sao Paulo. Shareholders will be asked to approve the share sale at an April 4 meeting.
“One concern we’ve heard from some clients is that the company is announcing this follow-on but not more disclosure on the portfolio that they are acquiring,” Franco said in a telephone interview. He rates the shares buy.
Equity issuance may come in several rounds over the next 12 months and depends on market conditions, Jorge Pigeon, Fibra Uno capital markets and investor relations officer, said in a phone interview from Mexico City. The shares may be issued to raise cash or swapped in exchange for properties, Pigeon said.
Fibra Uno shares have climbed 0.7 percent in the past year, while the benchmark IPC stock gauge fell 8.9 percent.